Nippon Life India Asset Management Limited (NAMINDIA) Earnings Call Transcript & Summary

Dear shareholders, it is my pleasure to welcome you all to the 28th Annual General Meeting of the company, which is being held through video conference in accordance with the relevant guidelines issued by the Ministry of Corporate Affairs and SEBI. Before we commence the formal proceedings, I would like to appraise you of certain aspects, which are relevant and are required for the smooth conduct of the meeting. The facility of joining this AGM through video conference is being made available for the members on a first come first served basis. This meeting is being administered and facilitated by the moderator to avoid any background noises and disturbance and to ensure smooth and seamless proceedings, the moderator has by default, placed all the attending shareholders on mute. [Operator Instructions] In case due to any technical or other reasons, as speaker shareholder is not able to join through video mode, then he or she may also join through audio mode. Possibility of connectivity problem or poor bandwidth issues cannot be ruled out at speakers' end. In such a case, we would request the next speaker shareholder to join. Once the connectivity improves, the previous speaker shareholder will be once again requested to participate and speak after the other preregistered speaker shareholder have completed their turn to speak. In the interest of time and to afford opportunity to each of the pre-registered speaker shareholders to speak all the speaker shareholders are being humbly requested to limit their speaking content to a maximum of 3 minutes. For any technical issues, which any of the shareholders may face during the period of this meeting, they may call the helpline number, which has been provided in the notice of this AGM and we assure to provide the best possible assistance. Live streaming of this meeting is also being webcast on NSDL's website. The company has taken all necessary steps to enable and ensure effective participation and voting by the shareholders. I would now like to request the Chairperson of the Board, Mr. Upendra Kumar Sinha, to Chair the proceedings of this AGM.

Thank you, Nilufer. Good afternoon to all our dear shareholders. I wish to disclose that I am the Chairperson of the Board of the company. And that, I have joined the meeting through video conference from my residence in New Delhi. On behalf of the Board of Management, I welcome all of you and extend our sincere gratitude for attending this 28th Annual General Meeting of your company. I hope all of you and your families are in good health. I have been advised by the Company Secretary that the requisite quorum is present to validly conduct the proceedings of this meeting. Participation of members through video conference is being recorded for the purpose of quorum as per the circular issued by the Ministry of Corporate Affairs and Section 103 of the Companies Act 2013. I therefore now call the meeting to order. I now call upon the participating Board members to introduce themselves one by one.

Good afternoon, everyone. I'm Sundeep Sikka, CEO and Executive Director of your company, and I have joined this AGM from the registered office of the company through video conference.

Good afternoon, everyone. I'm Ameeta Chatterjee, and I have joined this AGM from my residence in Mumbai through video conference. I wish to inform you that I am an Independent Director and also the Chairperson of the Stakeholders Relationship Committee of the Board.

Good afternoon, everyone.

I think Mr. Malik is...

Mr. Malik, request you to unmute yourself.

Good afternoon, everyone. I'm General Ved Prakash Malik, and I have joined this AGM from my residence in Panchkula through video conference. I wish to inform you that I am an Independent Director and also the Chairperson of Nomination and Remuneration Committee of this Board.

Good afternoon, everyone. I'm Ashvin Parekh, and I've joined this AGM from my office in Mumbai through video conference. I wish you inform the I am an Independent Director and the Chairperson of the Audit Committee of the Board.

Good afternoon, everyone. I'm B. Sriram. I have joined this AGM from my residence in Chennai through video conference. I wish to submit that I am Independent Director in your company.

Good afternoon, everyone. I'm Minoru Kimura, Director of the company, and I have joined this AGM from Tokyo, Japan through video conference.

Good afternoon, everyone. I am Tomohiro Yao, Director of the company, and I have joined this AGM from Singapore through video conference. I wish to inform that I am the Chairperson of the Corporate Social Responsibility Committee and the Risk Management Committee of the Board.

Good afternoon, everyone. I am Hiroki Yamauchi, Director of the company, and I have joined this AGM from Tokyo, Japan through video conference.

Dear shareholders, please note that in addition to the key executives and leaders of the company who have joined this meeting through video conference, the statutory auditors of the company, that is S. R. Batliboi & Co. LLP, and the secretarial auditor of the company, that is Mr. Mukesh Siroya of M Siroya & Co., have also joined this meeting in a singular fashion. The company has received intimation from corporate shareholder appointing an authorized representative under Section 113 of the Companies Act 2013. Only from 1 shareholder in respect of 45,90,28,095 shares of INR 10 each, which constitutes 73.64% of the company's paid-up equity share capital. Since under such kind of format, there is no possibility of securing physical attendance of the members. Therefore, in line with the applicable guidelines, there is no requirement of appointing process, registers, documents and records as required under the applicable law are available for inspection by the members. Members seeking to inspect that such documents can send an e-mail to the designated e-mail address. That is [email protected]. Members who have not voted earlier through remote e-voting can cast their vote during the course of this meeting through e-voting facility. The annual report of the financial year '22-'23 has already been sent to you. I request that the notice convening this meeting as well as the auditor's report on both the stand-alone and consolidated audited financial statements of the company and the secretarial audit report for the year ended March 31, 2023, be taken as read since there are no qualifications in these reports. I now request Mr. Sundeep Sikka, who is the company's Executive Director and CEO, to address this [ August ] gathering and also provide a business and information update about the company.

Thank you, Mr. Sinha. Respective shareholders, good afternoon to everyone. On behalf of the Board of Directors and the team at NAM India, I would like to thank you for joining our 28th Annual General Meeting. Overall, economic growth has seen a rebound after the pandemic and the real GDP growth for FY '23 is 7% plus. India continues to attract higher flows into capital markets through retail, institutional and offshore investors. Your company continues to work across mutual funds, AIF and offshore mandates to capitalize on these flows. The effect of higher retail flows into capital market is also visible by 28% growth in the demat accounts in India, which have reached 11.4 crores. The systematic monthly inflows that is SIP flows at an industry level are at a historic high of INR 14,300 crores as of March 2023, up from INR 12,300 crores in March 2022, which roughly translates to INR 100 per month per Indian. Now let me start with an update on the Mutual Fund segment, which forms a core part of our business. With increasing financialization, higher awareness and better reach through new age technology platforms and distribution network, mutual fund industry witnessed a growth of 13% in folios and 5.5% in AUM. The AUM reached an historic high of INR 40.5 lakh crores. The potential of mutual fund products as a long-term wealth creator is being realized by investors over the last few years and as it is evidenced by the strong influx of new investors. Unique investors in mutual fund industry in India grew by 21% CAGR over the last 3 years. While mutual fund AUM is at an all-time high, mutual fund still accounts for only 6% to 7% of the household savings in India. This, along with the under-penetration, where only 3% of the population is investing in India, signifies robust growth potential for asset management industry in times to come. Your company is at the forefront of fostering this opportunity of financialization by managing assets across investor spectrum to meet their varying needs. I'm proud to state that 1 in 3 unique mutual fund investors in India is investing in your company. It's an honor and privilege to be trusted by 1.35 crore investors, which is 36% market share of all the investors in India. Our systematic monthly flows increased to INR 1,115 crores in March 2023, up from INR 733 crores in March '22, and indicating an annualized flow of INR 13,400 per annum. Your company will strive to serve the interest of the unitholders in their journey towards wealth creation with the right people, right products, partnership and performance. We remain committed to wealth creation for our unitholders and profitable growth for our shareholders with strong risk management and processes at the core. Further, your company remains focused on its digital infrastructure with our platform being partner of choice, both for customers and the distributors. Our digital franchise contributed 57% of the total purchase transactions in FY '23. We had 9 new digital purchases every 1-minute, and we were searched on Google once in every 2.6 seconds. The management team continues to leverage the experience and direction that we receive from our esteemed Board members in every part of our business. For this, we'd like to express our gratitude towards them. Your company continues with the philosophy of shared prosperity with our shareholders through dividends. I'm happy to announce that Board has proposed distribution of 100% of profits of FY '23 to the shareholders, which is the highest dividend payout by the company. As a responsible investment manager, your company continues to move forward in achieving its ESG goals. We became UN PRI signatory in June 2021 and have adopted a structured approach towards imbibing ESG principles across all operations. Your company has positively impacted more than 3.8 lakh lives through its CSR activities over the years and has engaged with reputed institutions including Tata Memorial Hospital, Tata Institute of Social Science, Indian Army, Para, Olympic Gold Quest as a part of outreach efforts. As part of our investment process, we also take stewardship responsibility very seriously and aim to protect the interest of the minority shareholders through our Stewardship Code. I would like to inform you that in FY '23, we voted against 9,000-plus resolutions in our investee company. To sum up, we remain committed to creating value for all our stakeholders, including investors, shareholders, partners and society. With this backdrop, please allow me to go through the company's position and performance in FY '23. Your company is India's largest foreign-owned asset management company, managing an INR of 3.6 lakh crores with interest across asset management space, including mutual funds, both active and passive, AIF, venture cap funds and offshore business. It is an absolute honor and privilege to serve 1.3 crore unique investors through our digital assets, our physical network of 270 locations and a strong base of 91,000 distributors. Today, 1 in 3 mutual fund investors in India have been investing in your company with their investments. While we have the largest investor base in the country, we are happy to share that we added 15 lakh new unique investors, who have joined us during this year, leading to a market share of 36% of unique investors in the country. Further, our AUM ranking increased by 2 spots from #6 to #4 in FY '23. I would now like to share with you an overview of our performance in FY '23. Your company is a True Blue asset manager, while mutual fund remains the dominant business. We manage INR of 3.6 lakhs across business lines with operations in mutual funds, ETFs, AIF, venture funds and offshore business. We offer a comprehensive product bouquet to our investors across these business lines that cater to investors at all levels of expertise, risk-return profile and investment horizons. As on March 31, 2023, your company managed 103 open-ended schemes across categories of equity, fixed income, hybrid, ETF, index, real estate and venture funds. I would like to take you through the highlights of the various business lines, starting with mutual fund business. Within mutual fund business, we cater to all type of investors, retail, HNI, corporate investors. We have one of the largest retail franchise in the country, having 29% of AUM from retail assets against the industry average of 25%. Your company continues to have strong presence in smaller cities and towns. Our presence in beyond top 30 cities in India is strong with 19% of the AUM coming from these locations compared to the industry average of 17%. We continue to enjoy trust of a 1.35 crore investors with business being derisked across asset classes. We have a healthy asset mix with equity AUM at 44%, ETF at 24% and debt funds -- debt and liquid funds at 31%. Over a 5-year period, share of profitable equity mutual fund AUM within our asset mix has increased from 39% to 44%, while the share of ETF AUM has increased from 9% to 24%. As you know, systematic investment has been the backbone of the Indian mutual fund industry. Your company continues to focus on long-term stable profitable growth with high focus on SIPs, I'm happy to share that your company has a systematic AUM of in excess of INR 58,000 crores with an annualized systematic book of INR 13,400 crores. In FY '13, we added 9 lakh systematic investment folios taking our total folio base to 48 lakhs. Given our higher presence in smaller cities and towns, we have a lower ticket size versus the industry. This helps us to promote financial inclusion, while at the same time, gives us the key here. Responding to the changing needs of the investor, your company has also been focusing on ETF business. As you may remember, we had acquired business of Goldman Sachs in 2016, and since then, the AUM has increased 10x to -- in excess of INR 70,000 crores, and investor base has increased from 42,000 investors to 1 crore investors. We offer 25 ETFs, including having the largest gold and silver ETF in the country. For ETF, liquidity is one of the most critical factors that determine the flows in ETF business and has a direct bearing on the efficiency of the product. Our 61% of folio share enables us to have 70% volume share on the stock exchanges. The average daily volume of our flagship funds is 64x the industry average. Your company is only nonbank-sponsored AMC within the top 5 AMCs in India. This has been possible due to strong distribution network, both physical and digital, as well as trust of our investors. Your company has one of the largest distributor base of 91,000 across IFAs, national distributors and banks. Our share of AUM from IFAs is 58%, which is the highest within the top 5 AMCs. Further, no single distributor contributes more than 5% of the AUM, indicating the granular nature of our business. India is a vast country with diverse investor segments and every segment having different needs and characteristics. To capture this opportunity, we have created separate business verticals to cater to investors from small cities and towns to investors who are investing from as small as INR 500 to large institutional investors. We remain at the forefront of digital revolution with our platforms being a partner of choice for customers and distributors and all other fintech partners. While we have the largest physical network in the country, our digital strategy remains at the core for our future growth. Our future-ready digital platforms provide best-in-class experience to all our stakeholders, including customers and partners. We have built a robust digital infrastructure, which we have strengthened over a period of time with collaboration with leading technology companies like Adobe, IBM and others. The digital channel contributes 57% of our new purchase transactions in FY '23 with the total digital purchase transaction at INR 33 lakhs. I'm happy to share, we add 9 digital purchases every minute, and Nippon India Mutual Fund was searched digitally once in every 2.6 seconds. I'm happy to -- we will continue to focus our digital strategy as it adds to our reach, increases operational efficiency and improves customer experience. As mentioned earlier, we will continue to diversify into new business areas, mainly nonmutual fund business. Our subsidiary, Nippon Life India AIF Limited, manages 17 schemes across business lines. We have commitments in excess of INR 5,600 crores across our AIF schemes in equity, debt, venture capital and real estate. Going forward, alternates will be an important focus area, and we expect its contribution in overall revenue to increase. We have recently appointed new head for this business as we pursue our growth strategy. Nippon India Digital Innovation Fund, which is -- was announced during the bilateral discussion between Prime Minister of India and Prime Minister of Japan on the sidelines of G20 Summit in Osaka, anchored by large Japanese institutional investors and corporate investors -- it is anchored by large Japanese investors and institutional investors. We are in the process of launching its successor fund, which will invest in early-stage technology, VC funds, along with direct investments in early to growth stage start-ups. As Indian economy grows, inflows into country will continue to rise and your company would like to play a key role in that. We continue to leverage Nippon Life's influence into -- to create expressway globally. Our endeavor is to provide excess of Indian markets to the global investors. Your company manages offshore funds and distribution through its subsidiary in Singapore and also its representative office in Dubai. Your company has also notable international tie-ups in this segment, which will help us in our future growth. Now that I've taken you through different business lines, I would like to spend some time highlighting to you the critical -- some critical aspects that are overarching across your company. Let me start with the investment process. Investment remains core to our business, and we continue to build institutionalized and robust investment processes as we focus on being a faceless organization. Our focus continues to be strong on the search capability and risk management. Your company also benefits from sharing of best practices from Nippon Life Japan. Working closely with Nippon Life, we have introduced 14 factor analysis and PTC approach to our investment process. We also have experts from Japan, who help us to institutionalize these processes. We have a strong investment team with a strength of 60 members having a cumulative experience of 900 years. Our CIOs have been with the company and have an average tenure of 19 years. We have dedicated teams for credit research, real estate and venture capital. Human capital continues to be our greatest asset. Our focus remains on developing in-house talent to ready employees for larger roles and also adding fresh blood where required. We continue to focus on gender diversity. And in last 3 years, our gender diversity has increased from 17% to 20%. We will continue to focus on personal and professional development of our employees. Further, I would like to acknowledge the role of the families of our employees who provide them adequate support to enable the employees to give the best at work. As a responsible corporate citizen, your company continues to move forward in its journey towards achieving ESG goals. Our parent, Nippon Life Insurance Japan, has one of -- has been one of the initial signatories to UN PRI. Your company also became UN PRI signatory in June '21 and implemented various initiatives to institutionalize its ESG vision. We are moving towards zero carbon emission entity. Through a stewardship code, we provide -- we endeavor to protect the interest of our minority shareholders by actively voting in our industry companies. Keeping the industry trends in mind, NAM India is dedicated towards remaining ahead of the curve and has taken various initiatives in enhancing its performance, both at operational and investment level. CSR objectives of your company are aligned with UN sustainable development goals. In FY '23, your company contributed INR 14 crores towards various initiatives and over the last 5 years has contributed INR 100 crores. Your company engaged with reputed institutions like Tata Memorial Hospital, Tata Institute of Social Science, Indian Army, Para, Olympic Gold Quest, as mentioned in my opening remarks. We touched lives of more than 30,000 households in FY '23 through these initiatives and have overall touched lives of more than 3.8 lakh over a period of time. I would now like to present before you the key financial highlights for FY '23. We continue our focus on profitable growth. In FY '23, your company's net profit was INR of 723 crores. We also continue to build operational efficiency. Total operating expenses as a proportion of AUM have remained stable at 20 basis point year-on-year. In line with our philosophy of sharing profits with our 1.8 lakh shareholders, the Board of Directors have a stated dividend policy to distribute 60% to 90% of our profits. Over the years, company paid dividend consistently in line with the policy and for FY '23, your company has proposed its highest ever payout of INR 11.5 per share at a payout ratio of 100%. As I come to the conclusion of our presentation, Investor First will remain the key theme for us as we aim to expand our business, both domestically and internationally. We will continue to do what is right for the investor with sustainable profit growth for our shareholders, keeping risk management, institutionalization of processes and highest standards of corporate bonus at the center of our strategy. Overall, NAM India remains well positioned to capture the opportunity going forward. With this, I would like to end my presentation, and I'll now hand over the proceedings back to the Chairperson.

Thank you, Mr. Sikka. Before I proceed with the business of the day and I start inviting questions or feedbacks from the shareholders, may I request Mr. Tomohiro Yao, a Nominee Director of Nippon Life Insurance, to say a few words.

Dear shareholders, I am delighted to speak to our esteemed shareholders during Nippon Life India Asset Management 28th Annual General Meeting. If I may briefly introduce myself, my name is Tomohiro Yao. I am based in Singapore and working as Regional CEO for Asia Pacific and Head of India at Nippon Life Insurance Company. On behalf of Nippon Life, I'd like to briefly talk about our expectations in the Indian market and our commitment to NAM India. Nippon Life has been committed to the Indian market, which has a high potential for stable growth in the long-term, especially the asset management industry is still in high-growth phase so far, driven by huge underpenetration. NAM India is the largest equity value holding in any offshore subsidiary in the asset management business of Nippon Life Group. And I appreciate that NAM India is one of the highest contributors to our growth international business profit among with all our international group companies. NAM India is the largest foreign asset management company in India. And we are delighted with NAM India's successful journey so far. In the meantime, Nippon Life has been supporting NAM India's offshore activity by leveraging our global footprint and asset management operations. We will continuously explore more opportunities through our alliances to get global allocation into India and create avenues for India in business to invest abroad. Also, Nippon Life has been supporting NAM India management team by sending experts with rich experience in investment and risk management teams. Along with NAM India, we continue strengthening the risk and investment management processes by sharing and implementing best practices from Nippon Life's long-term experiences. By providing those practices, we would like to support NAM India's initiatives and future growth and help NAM India achieve better performance and outcomes for investors from now on. Thank you very much for listening. I now hand over to proceedings to the Company Secretary.

As per the Companies Act 2013 and SEBI listing regulations, which provides for electronic voting, the company has provided the facility of remote e-voting from July 8, 2023, 09:00 a.m. onwards to July 11, 2023, 05:00 p.m. It may please be noted that the voting rights of the members are in proportion to the number of shares held by them as on the cutoff date, which was July 5, 2023. The facility of voting at the meeting is also being made available to the members who are attending the AGM and who have not already cast their votes by remote e-voting. Members are requested to go back on the NSDL e-voting page and click on the EVEN number of the company to cast vote, while watching the AGM proceedings simultaneously. Your Board of Directors have appointed Mr. Mukesh Siroya of M/s. M Siroya & Co. company secretaries as the scrutinizer to scrutinize the voting process. Since this AGM is being held through video conference and the resolutions mentioned in the notice convening this AGM have already been put to vote through e-voting, therefore, there will be no proposing and seconding with respect to the proposed resolutions at this meeting. I will now request the Chairperson to take over and proceed with the rest of the proceedings.

Thank you, Nilufer. I will now proceed with the agenda in accordance with the notice of this AGM. The ordinary business items are listed as agenda item numbers 1 to 4 and a special business items are listed as agenda item numbers 5 to 6 of the notice. Item #1 is to consider and adopt the audited stand-alone financial statement of the company for the financial year ended March 31, 2023, and the reports of the Board of Directors and that of the auditors thereon; and b, the audited consolidated financial statement of the company for the financial year ended March 31, 2023, and the report of the auditors thereon. Item #2 is to confirm the payment of interim dividend of INR 4 per equity share and to declare a final dividend of INR 7.50 per equity share for the financial year '22-'23. Item #3 is to appoint a director in place of Mr. Tomohiro Yao, Director Identification Number, 08429687, who retires by rotation in terms of Section 152(6) of the Companies Act 2013 and being eligible offers himself for reappointment. Item #4 is to reappoint the statutory auditors of the company and to fix their remuneration. The next item of the notice pertains to my appointment as a Nonexecutive Independent Director, wherein I'm deemed interesting. Therefore, I now vacate the Chair and request General Ved Prakash Malik to act as Chairman for this item. Thank you.

Thank you, Mr. Sinha. I request the members to consider Item #5 relating to the appointment of Mr. Upendra Kumar Sinha as a Nonexecutive Independent Director. I now request Mr. Upendra Kumar Sinha to take the Chair and take the proceedings forward.

Thank you, General Malik. Item #6 is the appointment of Mr. Hiroki Yamauchi as the Nonexecutive Nonindependent Director. I now request the Company Secretary to call out the names of the members one after the other who have pre-registered themselves for seeking clarifications and for the purposes of offering their valuable comments and suggestions.

Shareholders are requested to note that, first, we will take all the questions from the shareholders, and those will be answered by the ED and CEO at the end. I would call upon the first shareholder, Mr. Santosh Kumar [ Saraf ].

[Foreign Language]

Our next speaker is Mr. [ Aspi Bhesania ]

Chairman sir, can you see me and hear me?

Yes, yes, I can see you and you hear you. Please go ahead.

Sir, I'm [ Aspi ] from Bombay. Sir welcome -- I welcome Mr. Hiroki Yamauchi, I also welcome Mr. U.K. Sinha as a Director -- Independent Director and Chairman, and I hope he changes his attitude from public to private sector. In India, there's a vast difference in the way public and private sectors perform. Sir, coming to the performance, we are almost stagnating in Q4 year-on-year and quarter-on-quarter. And also for the full year, there is a slight reduction. Where do you see growth coming from? Sir, since our parent is in insurance, can one of our subsidiaries not go into insurance? Sir, out of EPS of INR 11.53, dividend is INR 11.50, 100% of PAT, sir, don't you want to preserve some cash for future like acquiring another AMC or something like that? Sir, then 3% of our population is investing in markets, that's due to instability of government policies and milking of investors in stock market, when STP was introduced, FM had said categorically that STP is in view of long and short-term capital gains. Thereafter, both the gains were also taxed directly, results -- thus resulting in double taxation. Sir, top 10 non-promoter shareholders NIM should be given in the annual report. Sir, Page 132 of the annual report, unclaim dividends have been disclosed. Sir, amounts are big, and we are only current shareholders since we came with an IPO only recently. So how come such a big amounts are lying as unclaim? I'd request the Company Secretary to take personal interest in unclaim dividends, since this belongs to the shareholders. Sir, Kfintech simply send reminders and when shareholders try to claim the dividend, they create lots of problems. Sir, I'm talking from my personal experience. Sir, they never mentioned the name of the person who is writing the letter, no phone number, no e-mail ID. E-mail, in general, is there, but when -- and -- but there's no response. And if I call also, recorded message comes saying dial 1 for this, 2 for this. Sir, I request you to continue with hybrid meetings when physical meetings start. Sir, thank you very much, and all the best for the future.

Thank you.

Next speaker is Mr. Yusuf Yunus Rangwala.

Sir, very good evening -- good morning, sir -- good afternoon, sir. Sir, [Foreign Language]

[Foreign Language]. Please continue.

Sir -- very good afternoon, sir. And I'm very thankful to our Company Secretary, Ms. Nilufer madam, for giving me a chance. [Foreign Language] services are very excellent. Sir, as a Chairman speak [Foreign Language] presentation delivery very excellent, and I'm very happy to be a mutual fund business. Sir, I would like to know -- there are so many other companies' same business. Sir, what competition we're facing being a Japanese company? First, I welcome our Japanese people. [Foreign Language] I welcome all the Board of Directors. And I also support this physical -- this video conference meetings. You please keep our video conference. If next year possible before the Diwali, if you can possibly if you can give a small get together. So this is my humble request. Sir, annual report printed on e-mail, that is around 250 pages, very excellent, very colorful and very knowledgeable. I request to madam to send me annual copies, if possible, sir. Nothing more to add. I wish our company. I'd like to know total number of staff [Foreign Language] how many agents we're having I would like to know. Total number of agents in this business? As you mentioned, we had in the insurance -- sir, what -- the dividend that you've given INR 4 interior, final INR 7, which net to INR 11.50, that is a very excellent, very handsome. Sir, this is one company which paid our shareholder excellent dividend. I salute you for excellent dividend, sir. Nothing more to add. I thank our Company Secretary. And sir, also I thank our Japanese people. Sir, this is a Japanese company, sir. We are very happy that people of Japanese technology. If possible, if you can give us Diwali small get together. Nothing more to add. I end my speech thanking you, sir. [Foreign Language]

[Foreign Language]

Next speaker is Mr. Sourabh Paul.

Good afternoon, all directors and shareholders. My question is for Mr. Sikka. Sundeep, you mentioned in your speech about how you're leveraging the support from Nippon Life Japan. As I understand, many foreign players had not been successful in the asset management space in India and had to quit. How is Nippon Life different from other foreign players? And what difference do they make in your operations?

Next speaker is Mr. Rajendra Seth.

Mr. Rajendra, request you to unmute yourself and ask your question.

Hello? Hello?

Yes, we can hear you.

Chairperson Shri, management team and shareholder, [Foreign Language ] Rajendra Seth, Thane [Foreign Language ]

Next speaker is Mr. Anil Parekh.

Mr. Anil Parekh has not joined yet. Can we move to the next speaker shareholder.

Sure. Moving on next speaker is Ankur Chanda.

Hello? My voice is audible?

Yes, you're audible.

Yes, sir, you're audible.

Okay. [Foreign Language]

Next speaker is Mr. Bhavesh Soni.

[Foreign Language] esteem Board of Directors. My question to Sundeepji is, these days, everyone is trying to leverage digitization in their business. In your presentation also, we saw strong digital side at the company. So can you elaborate on the company's digital strategies and their impact on customers and business?

Next speaker is Mr. Mitra Bakshi.

Just want to know the new schemes in launching in the future and those to be among the biggest asset in the management marketing firms? And what is our claim settlement ratio?

Next speaker is Mr. Vinay Dherey.

Hello? Are you able to hear me?

Yes, sir.

Yes, please.

Yes. Okay. I'm Vinay [ Dherey ] the company shareholder. I'm speaking from Mumbai. Chairman, Mr. Sinha; Executive Director and CEO, Mr. Sundeep Sikka; Directors present at today's AGM; company executives; shareholders, good afternoon all of you. I have gone through the annual report. I have also intently heard both the Chairman statement as well as Mr. Sundeep Sikka's presentation. I'm extremely happy to note that Mr. Sundeep Sikka has been steadily leading the company through all these years. I'm extremely happy to note not only the company's performance, but also how we stand in terms of -- the standing in the industry also. 2, 3 observations were very useful as far as participation in this meeting is concerned. First thing is that 1 out of every 3 mutual fund shareholders -- investors -- Nippon Life investors, that is a key takeaway. Second thing is that we hold 36% market share of the industry. That is also a key highlight. And most important of all, as you mentioned, Mr. Sikka, that we have moved into asset management ranks from #6 to #4. So these are feathers in the cap. I have gone through the annual report. I find that we are doing very steadily. And I find no reason to take common time and ask any questions, I will only close with best wishes to you, the Board of Directors and the employees. Thank you for giving opportunity to speak.

Thank you. Next speaker is Mr. Mohit Bhansali.

Your company has been one of the few non-bank sponsor AMCs among the top 5 AMCs. I would like to compliment the company for your success. However, several more players have entered the industry in recent time or are in the process of launching operation. What are the company's view with regard to the increased competition and your strategy to tackle them?

And the last speaker would be Mr. Anjan Kumar.

Thank you for an excellent presentation. My question is to Mr. Sundeep. Mr. Sundeep, Nippon is a leader in the passive business, despite being a large active player. Do these 2 businesses tend to compete with each other? And how do we see the company grow in both these verticals?

So I'd like to address all the questions to our esteemed shareholders. I'll -- first, I want to thank all the shareholders for having trust in the company and the management team and your kind words. I'll try to answer most of the questions. I tried to club some of these together. Starting with Mr. [ Saraf ]. Thank you very much, I think, for your kind words. I think we continue our journey. And for us, our focus will remain on retail business. We'll continue moving into smaller cities and towns. We have been in this journey over the last few years, digital and AI has already been a part of -- has been a very important part of our strategy. Today, 57% of the new business that we are doing is happening through digital, and we will continue. We are also using artificial intelligence to understand the investor behavior and trying to look at other areas where artificial intelligence can be incorporated. To your question on women employees, I think I'm happy to share with you, our gender diversity has gone up from 7% to 20%, and we continue focusing on the growth -- inclusive growth for all our employees. Yes, I think as mentioned on Page 90 of our balance sheet, as on date today, we do not have any disabled employee. I think -- we continue looking, I think, from our perspective, I think wherever we can help any disabled employee, I think we will be able to give an opportunity to work in the company. Like you, we also look for an opportunity to have a physical meeting and whenever time permits and the situation permits, we like to have a physical meeting so that we can meet you personally. As far as the offshore business is concerned, we continue, as mentioned by our colleague, Yamauchi company and Nippon Life continues to focus on getting more foreign flows into India. Over the last few years, we have seen some limited success, but this will continue to be the focus of the company going forward. Mr. [ Saraf ], I would -- I also have reminded of a question that you asked last year about what is the trajectory of the digital and how much can digital contribute? Last time I couldn't give you an answer because we knew directionally, it is important, but happy to share with you, as I mentioned, 57% of new business has been done through digital platforms. Mr. Aspi. I think I will -- 2, 3 questions, which were there. One is, I will not be able to give forward-looking statements. But as I mentioned in my comments, we will continue focusing on various aspects of business and continue our focus on profitable growth. Our focus remains going to smaller cities and towns where we believe there's going to be a lot of wealth creation in Real Bharat. And I think, as a company, we have the highest market share in the beyond top 30 cities. You mentioned about EPS and the cash in hand. The Board continuously keep evaluating opportunities of how the money that we have in the company can be invested both for internal growth and also for future acquisitions. Your feedback for Kfintech is well taken. And I think we'll try to share this feedback with them. Mr. Yusuf Rangwala. I think it's -- to your question, we continue focusing, I think, on smaller cities and towns. I think the number that we have at this point of time, 91,000 distributors in smaller cities and towns who are trying to address the investors in these cities. We also believe, I think a lot of, as I mentioned earlier, there's going to be a lot of growth in smaller cities and towns. And we believe as a company, I think we need to play a bigger role in financial inclusion, and our focus will continue on that. Regarding Diwali. I think we'll definitely see if we can meet up before Diwali, and we'll be equally happy to meet you. The question from Sourabh. I think we are happy to share with you we are -- Nippon Life is a 133-year-old global company, and there has experience of working across the world. As mentioned in my earlier speech, Nippon Life continues helping us to grow and institutionalize our risk management and other areas of investment management. And as mentioned by Yamauchi, also we are trying to work together to see how we can get global allocations into India. Having said that, I would also like to highlight since you mentioned about other foreign asset management companies, I will not be able to comment about others. But I think from our perspective, we believe the key is localization and execution. The day-to-day operations of the company are run by the management team under the supervision and the guidance of the Board. We keep evaluating what are some of the best practices from Nippon Life and try to implement, localize them and implement them in India. Mr. Seth. Our focus continues, as mentioned earlier, we -- the Board has already -- first, to your question on dividend. I think Board has a stated policy of sharing 60% to 90% of the profits as dividend and -- which we have been doing over the years. And to your second question, rural markets. We are the market leaders in smaller cities and towns. But still, we believe there's a lot to be done. Our focus remains both on smaller cities and bigger cities, but if you have to see, I mean, going forward, with the advent of technology and digital, we believe we'll be able to penetrate these markets even further. Mr. Ankur Chanda. I think from -- you mentioned about the IPO and the share price. I will not be able to comment anything on the share price from -- the company continues to focus on execution, trying to go deep into smaller cities and towns and derisks business model. The profitability of -- the focus remains on having a stable and a sustainable profit over a longer period of time. And I think over the last 5 years, the company's profit continues to increase. We would again like to say share price is not something which is in our control. Our control -- what we control is execution, and we'll continue focusing on that. Mr. Bhavesh. Digital -- your question on digital. Digital remains a very, very important part of our strategy. As mentioned, we are doing roughly -- I mean, 57% of our new business is through digital purchase. Our philosophy on digital remains 3 Fs, which is having friendly, futuristic and frictionless our digital infrastructure. And I think we continue investing. We clearly believe, I think for the long-term, it's not only to get business but also for operational efficiency, digital will play a very important role, and we'll keep investing in digital. Mr. Bakshi, I think to your question on insurance. I think as a company, your company has a SEBI license of operating in asset management. The SEBI rules and regulations do not allow us to get into any other business activity. Mr. [ Bhinday ] -- [ Vinay Bhinday ] thank you so much for your kind words. From our perspective, I think the fact that we are -- it's an honor and a privilege that 1/3 of the Indian -- all mutual fund investors in India trust your company. We will continue penetrating more in smaller cities and towns and trying to make mutual funds more a household name. Our vision will be that every Indian household should be a mutual fund investor. Mr. Mohit, to your question of new players, I think we still believe India is very highly underpenetrated with only 3% of the population investing in mutual funds. I think it's good if more mutual fund companies and asset management comes or companies come, and I think they help us to grow the market. Having said that, for success of any business, there are a few things which are critical. One is basically having a strong risk management and the other one is going to be execution. As a company, we'll -- our focus remains on both risk management and execution. And we welcome more companies coming into asset management industry because it will help to increase the pie. Mr. Anjan Kumar, I think your question on active versus passive. As mentioned in my last slide, I think our philosophy is Investor First. We believe it's our duty to offer to the investor what is right for him. That in line with those principles, we acquired ETF business. And we believe there is a space for both. There are investors who will be investing in active. There will be investors we will be active investing in passive. We do not see this one versus the other. We believe both will find space in the portfolio of the investors. And as basis that your company will keep investing in both active and passive going forward. I've tried to make an attempt to address all the questions of our esteemed shareholders. In case there is anything that was unintendedly missed out or there are any additional queries [Audio Gap] be happy please to offer you the answer. I would now hand over the proceedings back to the Chairperson.

Thank you, Sundeep. Dear shareholders, please note that e-voting facility will remain open for the next 15 minutes to enable those members who have not yet casted their vote and would like to cast their vote now. I now authorize the Company Secretary to conduct the voting procedure and thereafter to declare the results of the voting in accordance with the prescribed procedure. Please note that the result of the voting, along with the scrutinizer's report, will be intimated to the stock exchanges and will also be uploaded on the website of the company, https://nipponindiaim.com. and the website of NSDL that is www.evoting.nsdl.com within 48 hours of the conclusion of the AGM. The business of this AGM having been completed. I now announce that this meeting stands concluded. I heartily thank all the esteemed shareholders for their active participation and for making valuable suggestions. I also take this opportunity to wish all of you and your respective families, best of health. Thank you.