Punjab National Bank (PNB) Earnings Call Transcript & Summary

Ladies and gentlemen, good day, and welcome to the Punjab National Bank Q2 FY '22 Earnings Conference Call. Hosted by Batlivala & Karani Securities India Private Limited. [Operator Instructions] Please note that this conference is being recorded. Participation in this conference call is by invitation only. Punjab National Bank reserves the right to block access to any person to whom an invitation is not sent. Unauthorized dissemination of contents or the proceedings of the call is strictly prohibited, and prior explicit permission and written approval of Punjab National Bank is imperative. Please note that this call is only for investor or analysts. I now hand the conference over to Mr. Suraj Das from Batlivala & Karani Securities India Private Limited. Thank you, and over to you, sir.

Thank you, Jacob. Good afternoon, everyone, and thanks for joining the call. On behalf of Batlivala & Karani Securities, we welcome you to Punjab National Bank's 2Q FY '22 Post-Results Conference Call. We have with us today the management team of Punjab National Bank, represented by Mr. Mallikarjuna Rao, MD and CEO, sir; Mr. Sanjay Kumar, Executive Director; Mr. Vijay Dube, Executive Director; Mr. S.K. Saha, Executive Director; Mr. Kalyan Kumar, Executive Director; and other senior officers. I would now request MD and CEO, sir, to start the call with his opening remarks on 2Q FY '22 results. Post which, we will start the Q&A session. Thank you, and over to you, sir.

Right. Good afternoon with only a small correction that Mr. S.K. Saha, who is Executive Director, is currently not there. There was a requirement of official work where he has gone. Otherwise, I'm there with Mr. Sanjay Kumar, Mr. Dube, Mr. Kalyan Kumar, 3 EDs and the top management. Now continuing with the brief presentation. In fact, our presentation has already been published in our -- via the corporate website. However, I will trigger discussions by giving the brief of what we have done at the end of September 2021. With respect to the -- I directly go to the asset quality. With respect to gross NPA, you must observed that we have reduced 14.33 to 13.63 sequentially from June -- compared to June '21, in September '21. Similarly, at NPA, we reduced it to 5.49 quarter-on-quarter from 5.84. Then with the net profit, what we have declared is INR 1,105 crores, which is 78% above when you compare with the year-on-year. That is what is June '21. Then with respect to capital adequacy ratios year-over-year, it improved to 15.20 in September from 15.19 in June or 12.84 in September 2020. Coming to the business figures, our retail has grown by 6.7%. Agriculture has grown by a little over 7%. MSME has grown by 2% while retail growth has been the overall RAM growth has been reasonably good. Total loan book has grown by 2.7%. There has been -- you aware that because of the current year rates and the liquidity high available, the corporate line of credit, whatever we have given, has been changing from one bank to other banks. Still, we were able to create good amount of -- by current quarter with respect to priority sector and other advances as we have achieved the targets, which were required from the government perspective. And coming to certain critical points related to net interest income, where we have seen the reduction and operating profit where we have seen the reduction, though we have booked it for return [indiscernible] crores. If you compare the net interest income with the quarter 2 of last financial year, we need to remember that in the last financial year until March 2021, for the 9 months period, there was no identification of NPA because of Supreme Court holding back on the judgment. And when the court segment came in the month of March, we have identified NPA. As a result, in the quarter ended September and December, the interest income appears elevated because the identification of NPA not being [indiscernible] was not there. That is one reason. Second reason because of the pressure of interest rates, we have drastically reduced our interest rates for the MSME and retail segment in view of the competition. And we have also reduced our processing fee. Particularly for the season -- for the period from July onwards, the COVID wave has picked up. Now we expect that these kind of prices and other things will moderate in the next couple of months to come. However, there are certain other vertical expenses which have become in this quarter only. For example, the expenditure related to pension 30%, when the family pension has been done, it has permitted us to spread it over a period of 5 years, total 5 years, it comes to INR 3,800 crores. Out of which, this year applicability, 1/3 of it, we have already provided in this quarter. Similarly, performance linked incentive applicable for the year -- yearly expenditure also has been booked in this quarter. That amount is around INR 270 crores. Other than that, there are a few staff-related expenditure, particularly the transfers and other expenditures which gets booked in quarter 1. But because of COVID when the other things are delayed, they got booked here. So there was a cumulative impact a few expenses, which has also contributed to the decrease. Another important factor was onetime profit was there last quarter, around INR [ 730 ] crores out of the recovery in Kingfisher account. The current operating profit appearing at INR 4,000 crores at the end of September, it does not actually reflect the potential of the advance book of our bank. Our December projection will be anything between INR 5,000 crores to INR 5,500 crores, which is a normal one. Even if you look at earlier guidance also what we have given, INR 22,000 crores to INR 24,000 crores is our operating profit expected in the financial year, which we will be confidently able to achieve making up in the next 2 quarters. This quarter is a little amount of aberration since we have taken care of various other factors. Coming to the provisioning. The credit cost remained at 1.47, which even earlier, we had indicated that it could be hovering between 1.25 to 1.5. Currently, it has been -- stood at 1.47. There was a write-back of [indiscernible] even provided and [indiscernible] NPA in September related to Srei group amounting to INR 2,800 crores. Thereupon, we have provided 40% so that in future, we will not have any difficulty in terms of when the settlement takes place. We will also observe that there is a tax negative just before the net profit. The amount was roughly around INR [ 23,300 ] crores. But the actual figure is around INR 700 crores. That INR 700 crores was a provision done by the bank earlier. And it has been disputed between the tax authorities, but the judgment came in favor of this bank. As a result, that reversed. But the reversed amount in entirety, we've utilized for providing to Srei accounts. Srei requirement is only 15% based on the record of recovery when the account has become NPA. However, we have provided additionally by upfronting the provision by additional [indiscernible]. So we utilized INR 700 crores there. And because the requirement of provisions were limited and as was expected, the net profit as per the guidance given by us stood at INR 1,105 crores, still, we retained our guidance, with our overall profit would be between INR 4,000 crores to INR 6,000 crores. It could be so that in the next 2 quarters, the profit may go -- maybe around INR 1,500 each. Coming to treasury. Treasury has continued to contribute up to H2. Last Q1, it was around INR 1,100 crores. What we got treasury income. It's -- quarterly, it is around INR 1,030 crores. And though probably it will come down in the next 2 quarters, but still, we have not used any amount from the HTM. As per RBI guidelines 5% [indiscernible] which assures me around INR 650 crores to INR 700 crores of profit whenever we do that. We'll be doing it appropriately before the prices move up. So otherwise, in the next 2 quarters, our treasury income estimate could be anything around INR 1,200 crores to INR 1,300 crores, what we are expecting. This is the overall position with respect to what we have done. And now I am open for the queries. Thank you very much.

[Operator Instructions] The first question is from the line of [ Subra Tiwari ] from SBI Life.

This is regarding the fresh slippage. So in Q2, while in most of the segments, the slippage has been much lower than that of Q1. In the other segment, it is much higher. So if you can throw some color as to in which segments within this other it has been high and why?

That 4,031 contains 2,800 of Srei...

INR 2,031 crores, okay.

If you look at it, retail slippage was INR 650 crores; agriculture, 1,384; MSME, 1,555. Everything is under control. Other category, what you see 4031. There are 2 big accounts, one is INR 2,800 crores of Srei. Another is [indiscernible] around INR 800 crores.

Okay. Okay. And any guidance on what could be the recovery then, upgrades for the full year?

Right. If you have seen the recovery in current quarter itself in Q2, 9,126, which you must have observed, this 9,126 comprises 1,589 from retail and 1,256 from agriculture, 2,947 from MSME and 3,334 from others. So what I wanted to make a point is that the recoveries have been higher than the slippages in the current quarter. If you take out an exception of INR 2,800 crores of Srei which we are aware, the recovery has been much higher than this slippage. Similar element of performance, we are foreseeing in the next 2, 3 quarters. And with respect to the recovery, if I want to give you the little what is the color on that, we are expecting INR 1,500 crores of recovery through NCLT cases in the next 2 quarters and a further recovery and upgradation I'm expecting anything around 15,000. So roughly, it would be anything between INR 16,000 crores to INR 18,000 crores. That would be recovery cum upgradation in the next 2 quarters. And our slippages will be controlled at a gross level at INR 8,000 crores in the 2 quarters. However, when you club all these things because in H1, the slippage has been INR 13,700 crores roughly, our guidance has been between 16,000 to 18,000. That means in the slippage whatever has happened, no, they will be further upgradation during the next 2 quarters. And overall for the year-ending slippage will be between 16,000 to 18,000. But at the gross level, next 2 quarters, it could be around INR 7,000 crores to INR 7,500 crores. You must have observed that out of the slippage of Q1, we have upgraded INR 2,500 crores in Q2. So based on that kind of past background I'm giving these details.

The next question is from the line of Mahrukh Adajania from Elara Capital.

Sir, my question is on margin. So you did explain that retail and MSME rates have come down. So the rate reduction is only explanation over because margins have declined quite sharply?

No, no. There are a couple of other reasons also. One is the -- that impact is only INR 150 crores in the quarter. The rate reduction in retail and MSME overall impact has been roughly INR 150 crores. However, that is related to retail. But otherwise, large amount -- because of the high element of liquidity available, the reaching of the advances has taken place during the quarter. In many of the corporate advances, wherever we have funded at MCLR-based funding, it was priced at repo-linked pricing and G-sec linked pricing. That is the major impact on the income. I'm expecting this to moderate down from December onwards. And because of other sectors also contributing, we have seen lower net interest income, lower margin and lower operating profit. But some of the factors will not be there in the current quarter. So there will be a better performance in the current quarter. And furthermore in quarter #4 because the interest rate, I'm thinking to, moderate down because as per the RBI indication itself, there will suck liquidity expected to -- there will be liquidity to INR 2.5 lakh crores, 2.5 trillion by December second week. So these are the expectations.

Got it, sir. Sir, you said that the demand recovery was INR 1,097 crores. Is that what you said?

What is that?

The recovery...

INR 1,217 crores.

Okay, sir. Sir, and what is the status on Air India now in terms of what our exposure is and how much is secured, how much is not?

No, in this everything is government guaranteed only except INR 400 crores. We have an exposure of INR 5,457 crores. INR 450 crores is the one where the government guarantee is not available. Remaining entire amount guarantee is available. Number one, as you are seeing in the public domain -- you will see in the public domain, discussions have already started. We are expecting that the resolution could take place to greater in December and if any residual area is there in the next quarter. That is in Q4.

But -- so if there is a haircut, will you have to provide for it till the government guarantee is involved? Or how does it work?

No, no, no. You see now that resolution is aside. If you go through the RBI circular also, there is a requirement of pursuing for the resolution. And if there is any reason of delay in resolution, there is a provision requirement is to be done. That is an accounting issue. However, coming back now because the resolution is in the site, everything is in the pipeline. We are expecting that the thing should be to a greater extent, the resolution with respect to the Tata, who have bid for it will be completed by December. And the other things where the -- some of the debt will be transferred to another account where assets will be transferred by the government of India, that could take another one quarter for resolution.

Right. But in the interim, will we have to make any provisions or no?

We have already done that. We have already done that as per our levels.

Okay. So no further...

It is government guarantee.

The next question is from the line of Karan Gupta from KP Synergies.

Sir, you mentioned some one-off expenses related to employee fund, et cetera. Could you just supply how much total was for this quarter?

When I say one-off expense, it is related to the year. For example, performance-linked incentive, INR 271 crores we have booked in this quarter. That is related to employee. Second, yearly transfers generally take place in the first quarter itself. Because of COVID, that was spread beyond first quarter. In fact, we did not do anything in first quarter even though we have done everything was affected in the second quarter. But generally, [indiscernible] INR 100 crores -- INR 70 crores to INR 100 crores will be the expenditure on complete overall bank when we make the transfers. Last year, we could not do many transfers because of severity of COVID. But this year, there was some element of leeway as well, transfers, even backlog to be done. So there is one more area. Second, the NPS [indiscernible] increased 10% to 14%. This anyway regularly it is required to be done. But dependency of 10 months amounting to roughly INR 120 crores also we have taken care. Then there was also a requirement of what you call the employee medical-related issue. That is around INR 139 crores, which we have done. Another provision -- another -- related to pension where the 30% provision as pension has come for the family pension without any limit. There, the overall requirement is INR 3,800 crores as per RBI guidelines to be spread across 5 years. It comes to roughly INR 750 crores to INR 780 crores for the year. Now this quarter being #2, 1/3 we have done the provisioning. So this provision will continue in the next quarter, the 2 -- the growth, which we will take care. It is not a one-off provision. It is a new provision started, which was not been earlier. So I would like to signify that these expenditures were not there earlier, which are done in this quarter. Some of them will continue, some of them will not be there.

Okay. Sir, I appreciate that. And sir, one more question. So the rising of credit lines as well as the lower interest rates that you're offering for -- to the retail and MSME segment, have you seen an increased competitiveness for the bank? Or are you seeing -- do you expect higher loan growth compared to other banks? Or do you think now you're at par with where the other -- where the competition was? And so basically, are you expecting related loan growth going ahead?

See, frankly speaking, prior to this quarter, that means in the quarters of December, March and June, tremendous amount of competition was there from other banks where some of our smaller accounts in MSME category with a lower interest offered by the other banks were taken over. That was a very important figure for us. Then we have completely [indiscernible] in all the zones. And after [indiscernible] feedback and also understanding what kind of interest rate is offered by the other bank who was taking over our accounts, we have reduced the interest rate. So the purpose was 2-dimensional. One purpose is to others will take over it at any cost. There was a call given by us that not a single account should be allowed to be taken over. that we have achieved from the month of July onwards. Second one, taking advantage of this increasing the credit. So reasonably at the end of September, we have done the growth, if you compare with others, even in overall credit as well as in other segments. But the growth will be much better in the December quarter because as of October, we have launched a campaign for all these areas. And as on today within one month, I'm seeing a very reasonable sanctions, which have come in all these areas. So this -- there are 2 dimensions, one is to RFB takeover. Second is to see that the growth will be there. So our guidance of 6% to 8% growth by March, we are very confident of achieving that because of these measures.

Okay, sir. And one final question, sir, with regards to occupancy costs, et cetera. So after the merger, we've noticed the occupancy costs have also gone up this quarter. So any guidance for that going ahead? Do you expect any cost savings, et cetera? Or should we expect a similar level?

When you say occupancy cost, are you looking at the employee cost to be incurred?

No. I'll just pull up -- apart -- in your operating expenses, apart from employee expenses, there was other operational expenses have increased. So I just wanted to...

So, there are 2 things. The ratios appear to be a little distorted because of the income being low, so denominator is low. Second, even on this value-wise, if you look at, yes, there has been increase in the employee cost as well as other cost. Employee costs, I've already given explanation to you as to what we recapture. In others, there are certain AMCs of the technology applications which were done in the quarter 2, which are actually undertaken yearly once. And these AMCs, majority of them were paid in the quarter 2. That is one. And by undertaking the exercise of rationalization of branches where in almost 750 branches we have merged with other branches. The residual issues related to lease payments completely, we have cleaned. And those payments were done in quarter 2 as well you will find an increase in the cost. But these are also actually one-off cases. No regular cost will be there. But otherwise, it will not be a recurring cost.

[Operator Instructions] The next question is from the line of [indiscernible] from Morgan Stanley.

Also, first of all will you check your slide of course moment of NPA, recovery includes written off accounts. And I wanted to understand the accounting for which -- I guess, RBI has asked to knock out some provisioning.

Correct. See, RBI 30th of August has indicated about 2 areas. One is the provision required to become M2M to be booked to be operating [indiscernible] provisioning level. And the second one is recovery from [indiscernible]. That M2M to be operating income, thereby, there was an impact on operating profit to the extent of around [indiscernible]. And in terms of recovery from return of records, we have still shown in other income only. And accordingly, whatever we mentioned in our books of accounts -- notes of accounts.

Okay. And with respect to this reconciling, the overall restructuring, sir, restructuring under 1.0 has been around INR 10,000 crores -- sorry, INR 7,000 crores and 2.0 is 10,000. So an MSME is additional INR 2,700 crores.

Correct.

So there is no overlap, right?

There is no overlap.

Okay. And sir, so with the disclosure in the [indiscernible] filing where there have been repayments from restructuring 1.0 and slippages from 1.0, sir, so can you just go through the filing? I don't understand the report.

No. Actually, in terms of the OPR that is restructuring, RBI guidelines feedback, at least more than 30 days, the account has to be identified as NPA, if I understand your point exactly. So those accounts where there were DPDs more than 30 days out of the OPR first, we already identified them as NPAs.

Okay. And just one last thing.

Yes? Hello?

Sir, what's -- indicated, sir, what would be the [indiscernible]?

MSME book, researcher book?

Yes, sir.

No, that is what I indicated, it is only a small amount.

Okay. Okay.

That is INR 52 crores.

We have the next question from the line of Mohit Surana from CLSA.

If I heard you correctly, you said that in the corporate segment, there was some relinking of loans, which were previously based on MCLR-based rate to repo-linked. Did I hear you correctly?

No, it is not relinking. It is repricing. The reason is, it will not be loan being continued, and the rate has been changed. These are all short-term loans. Initially, were given for 1 month MCLR and 3 months MCLR. After 30 or 90 days when displayed as WCDL, they were not ready to take an MCLR base. Then we had to give an external -- other external rate at this either G-sec or repo base. That is what I was indicating about repricing. It is not a continuous loan. It is a short-term loan, WCDL, which is a regularly take. And those were repriced very aggressively in the last 3 months.

Okay. Understood, sir. Sir, and one more thing, I just wanted to understand that some of these repricing in corporate as well as retail MSME, at which point in quarter were they done? I'm just asking because I just want to know that the NIM that we have achieved in this quarter can be at the same kind of a run rate. Or if these adjustments were done, say, in the middle of the quarter, then there are some more pressure in NIMs to come in the subsequent quarters? Just wanted to understand.

This was effective from August. In the current quarter, if you look at August, September [indiscernible] this was implemented, and the impact is not very high in MSME and other things. It is only INR 150 crores of the impact in 2 months. So roughly around INR 75 crores impact in a month. If you compare with around INR 4,000 crores of interest income what we get in every month, it is around INR 75 crores. But the more impact is on repricing, which anyway a short-term phenomena that is going to undergo change in the next -- that is in the current quarter from October.

Okay. So you will again reprice those loans when conditions are more conducive to repricing them higher? You will again reprice them based on MCLR, which you will do?

Liquidity is [indiscernible], automatically price will go.

Okay, sure. Understood.

Because of high element of liquidity we are carrying there was no choice but to utilize that because otherwise in the investment, I'm getting 3.35 if I'm putting in repo, reverse repo. If I go for the variable reverse repo option, last time when -- they have run for 2 lakhs, the average rate was around 3 point -- weighted average of 3.55. So if I'm getting more than that, I'm deploying here. So this position will improve from November onwards -- mid of November onwards. Slowly RBI will be reducing the liquidity.

[Operator Instructions] We have the next question from the line of Saurabh Kumar from JPMorgan.

Sir, I just wanted to ask 2 questions. One is, can you quantify what your agri -- Indian agri book? Or is the total gold loan book or the total gold loan bank...

Gold loan is very small. Actually, our bank is not very strong in gold loans. Since it is a northern based bank, it is very low. It is even around INR 400 crores to INR 500 crores, as low as that.

Okay. Okay. And the second, sir, is on your comments on your PPOP. You said INR 5,000 crores to INR 5,500 crores per quarter. So basically, the core number, if you remove the treasury income that the core PPOP should be now INR 4,000 crores.

No, no, no. What I said is a reasonable treasury income. Treasury income also currently, if you look at it in the last 1.5 years, it has been elevated. And average income per treasury will be roughly around INR 2,500 crores to INR 3,000 crores in a year. It is also a cycle depending upon the prices will go. The last year income was more than INR 4,500 crores. And this year, we are expecting -- already we have got INR 2,130 crores in H1. But in H2, it will be more than 1,200. So it will come to around 3,300. So my [indiscernible] in a quarter, if you look at INR 22,000 crores for the entire year of operating profit, the reasonable estimate from the treasury will be anything around INR 3,500 crores.

Okay. So your core PPOP should be in the INR 19,000 crore odd mark. That's...

That is without treasury. Correct.

Okay. And if we account...

So anything between INR 4,000 crores to INR 4,500 crores will be my interest income and other income.

Okay. And if you remove for the RBI circular, sir, the -- I mean, the recovery income spend, what should the core -- I mean I'm -- what I'm trying to get is once you fully migrate to this new RBI circular where the recovery income.

That could be -- you can say on average around INR 1,000 crores of profit. INR 1,000 crores is per quarter I'm saying. INR 1,000 crores is coming because one of the other bigger accounts, they get settled [indiscernible] where we must have made full provision, 100% provision. For example, DHFL is one, of course DHFL provision write back only we have taken. So INR 1,000 crores will be roughly, anything around 800 to 1,000 in a quarter. So it could be INR 3,600 crores to INR 4,000 crores in a year.

Okay. So if we take [indiscernible] for the year, 3,000 -- 3.5 for treasury and about INR 4,000 crores for the recoveries, the core number should be closer to the 17.

INR 6,000 to -- suppose INR 7,000 crores if you remove from INR 22,000 crores, INR 15,000 crores would be the credit income, straight away.

The next question is from the line of Anand Dama from Emkay Global.

Sir, I wanted to understand basically that you said you had 2 large lumpy accounts being recognized in the current quarter. I think one is Srei, another is the entertainment company...

Which is around INR 790 crores.

Sorry, sir?

INR 790 crores.

Okay. Sir, are there more lumpy accounts which are there in pipeline in terms of NPA?

Not many. There are 6, 7 accounts where we are expecting, but that is overall amounting to INR 700 crores.

Okay. Those are small...

The entire -- the decision part of the financial year, that is H2, maximum it could be anything around INR 1,300 crores to INR 1,400 crores.

Sure. And sir, any large accounts which are there for resolution, particularly in the power sector or the infra sector that you're foreseeing in next 3, 6 months?

No, no. What I have estimated is INR 1,500 crores recovery I'm expecting in the next 2 quarters from NCLT, on our smaller accounts only. Roughly around 20 accounts are there where I'm expecting INR 800 crores recovery by Q3. And there are 7 accounts expecting around INR 750 crores to INR 800 crores recovery in Q4.

Okay. So does that mean that basically not any larger account is actually expected to be resolved?

No, larger account is there but the extraction is very low, for example Jet Airways is there. What you're getting is a very small amount. Splendid Metal Products is there. Bigger account only, but what we you are getting is smaller amount, so like that. So I'm counting on only what I'm going to get, even though the account is a good one.

Sure, that is recovery. But say for instance, from your NPAs, the entire exposure will move out...

INR 3,920 crores in Q3 and INR 2,200 crores in Q4. So what I told you 1000, I'm getting recovered. It will effectively reviewed, the outstanding of around INR 6,200 crores.

Yes. That is I think very helpful...

Yes. That is what I want. You wanted that. That I'm...

Yes, yes.

Comprising around INR 27 crores.

Okay. Okay. Okay. And sir, what is the status on this NARCL transfer when it will happen? And in that case, how much of NPAs actually will get reduced because I think I believe some of these accounts, which are there in the NARCL will -- basically written off completely...

Absolutely right. See NARCL, we have identified INR 8,800 crores, which is Phase 1, which we are expecting the transfer to take place before 31st of December, it is INR 6,700 crores. INR 6,000 crores -- out of the INR 6,700 crores, the amount of INR 700 crores, which is an outstanding account. Otherwise, INR 6,000 crores written off. So not much of reduction will be there in the gross advance sales. However, we have a profit of around INR 162 crores. When these are transferred there, we are expecting an extraction of 18%. Out of that 18%, 15% will be the cash component, so which comes to roughly around INR 160 crores to INR 165 crores. That could be going to the profit in the quarter 3.

Okay. Okay. So NARCL aspect is also not going to help you much in terms of NPA reduction...

NARCL will not give me in the first phase, probably in the second phase. But what we have done is we have identified around INR 600 crores of the accounts, where we are either member of consortium or a member in the multiple banking where other banks have sold. One of the banks have sold to ARC. So what we are now going to and that is before December, we want to sell them to ARC, because already one of the banks have sold, which we would like to have in the process. That -- out of the INR 6,000 crores, almost INR 4,500 crores is the one which we are expecting to go out of the gross book. Like I've indicated in the beginning, our gross NPA is 13.63. By December, I'm expecting to be below 13%, and our net NPA is 5.49. I'm expecting it to be below 5% by December.

Okay. And sir, will there be a Phase 3 and Phase 4 as well in the NARCL?

It will be there. Phase 2 will be their first because now the criteria was where each bank has 500 crores and written off accounts. This was the criteria. Now the criteria will not be written off. All the accounts will be taken care.

And sir, what is happening in terms of recovery from Nirav Modi case or from Mr. Mallya?

In Nirav Modi case, the amounts which are coming from abroad are not very huge amounts, very small. And also legal cost is very high. Suppose we recover INR 40 crores roughly, legal cost itself goes to around INR 15 crores to INR 16 crores, and residual comes to us. But the major development has happened locally when recently enforcement directorate claim was nullified by NCLAT in terms of the Vijay's case, that is Kingfisher case. Thereby, the consortium of banks could sell the shares of United Breweries. So that side effect has come on Nirav Modi as well because there were assets which were confiscated, the [indiscernible]. Now the ED has permitted us to file for the same, and we have already filed. I am expecting that these assets are handed over to the recovery office, then we will go for auction. Some of the part of recovery could happen before December, maybe around INR 400 crores. And the remaining around 500 to 600 could come in the next quarter.

Okay. And sir, any power sector resolution in terms of takeover of these assets by NTPC or some other companies, if that can happen? Whether that is going to benefit us in any way?

Not much. In power sector, no.

Super.

Yes.

The next question is from the line of Prabal Gandhi from Antique Limited.

Sir, am I audible?

Yes, yes, you are audible.

So you mentioned that [indiscernible] back of nearly INR 700 crores. And in this quarter, we utilized around INR 340 crores. So can we expect more utilization in coming quarter?

Which one? Which one?

[indiscernible] that disputed amount...

It's only a one-off case where the provision was done in the earlier years. With respect to a dispute of reckoning certain amount of exemptions, that they have settled last 3 years of the tax returns, as a result of which we have recognized our contention. That is reasonably the INR 700 crores as a one-off case has been reversed. While reversing what we have done is this entire 700, we have booked to -- we have added to the provision of Srei account as I've indicated because the provision now coverage is around 40%. Further, if you see the balance sheet, you will find that provision for income tax negative is only INR 345 crores. That means another INR 355 crores we have reversed from the DTA.

And going forward, what is the tax rate that we should assume?

Look, same thing. That is the tax rate is -- we have not shifted to the new tax regime. We are still working on that, and we are not recognizing any DTA. In the last 1.5 years since 1/4/2020, you must observed that we have not recognized any additional DTA on the contrary. As of now, around INR 2,100 crores DTA we've reversed from 1/4/20 onwards.

Got it. Sir, on the restructuring and on the ECLGS, if you can comment how the performance has been of the book so far...

ECLGS 1, 2, 3, 4, the various tranches were there. INR 14,000 crores we've sanctioned and INR 12,700 crores is roughly the amount of disbursement. Now because of the further change in terms of eligibility what government has brought about very recently, we are expecting that we could sanction anything around INR 6,000 crores to INR 7,000 crores additionally. Work is in progress, and we are expecting these 2 to be crystalized before December.

And how has been the performance for the ECLGS disbursed so far?

It has been booked. Absolutely, there has not been any problem except very few accounts, very small accounts.

And on the restructuring front, what is the performance like?

Restructuring front also, earlier, I indicated that there was a small amount. Overall, 200 crores is the one which we have identified as an NPA from OTR 1 because of the overdue being more than DPD 30 days.

That was flipped into a...

Correct. Correct.

Sir, just last question on the corporate side. So in your initial remarks, you mentioned that you have created a good pipeline for the corporate by...

Correct. Correct.

What is the pension pipeline that we have?

You see, if you look at overall, there are 2 components, in-principle approval and the final sanction. Together, 1, 25,000 crores. In principal approval is around INR 68,000 crores. And the remaining is final sanctions given where -- even disbursement only will have to take place. Already sanctions have been completed. So we are expecting that these disbursements could take place up to 31st of March. Further, we are creating pipeline. We want to create a pipeline of roughly around 2 lakh crore by December. So that disbursement will happen as it is required rather than on our anticipation. We expected disbursement generally ease of the pipeline around 30%.

30% of the sanction limit usually get...

Sanctions whatever we convey, we expect 30% only to happen over a period of time. That means in the -- suppose we create a pipeline of 2 lakh crores, around INR 60,000 crores could be disbursed up to, what you call, March.

Right. And sir, which are the segments which are garnering from strong pension?

Various. For example, state government is there, which is in the public domain, if you have observed, we have given around INR 5,100 crores to Uttar Pradesh Infrastructure, UPEIDA, where we have discounted the cash flows of Agra Lucknow expressway. So that disbursement is in the progress. Similarly, there are various other government-related, public sector-related where we have sanctioned. There are road projects as well, more than 2 dozen road projects we have approved. Even though each project amount of sanction is not very high, it could be around INR 300 crores to INR 400 crores on an average, but there are more than 2 dozen projects. So that also, it is a pipeline created, slowly disbursement will take place based on that. There are even other -- some of the other categories in the infrastructure segment where we have funded. So these are the pipelines. Some of the pipelines could happen immediately because some of the sanctions are to NBFCs also. That could happen immediately.

All right. And these are all linked, meaning if the interest rate goes up, the interest component will increase for us as well?

What did you say?

The projects what you have sanctioned, these are all linked. So in case the utilization takes place and if the interest rate increases, we are going to get benefited out of it.

Correct. Absolutely right. There is no fixed rate we have given, not to anybody. It is all -- even if it is an external benchmark like what you call repo rate or G-sec, they are all margin-based. And if the repo rate increases, automatically, the price will increase. And if the G-sec increases automatically, it will increase. But for road products, we have given link to MCLR only.

The next question is from the line of Abhijeet Sakhare from Kotak Securities.

Sir, sorry, I missed the comment on the NII decline this quarter. Sir, if you could repeat that one, please.

See, NII was 6,353 this quarter. If you compare with the Q2 of last year, it was 8,455. The first comment what I made was that last year, as you remember, NPA identification was not done because of Supreme Court embargo on that. The judgment came only in the month of March. As a result, the quarter-ended interest income for September and December was not impacted by the reversal of interest, which otherwise would have happened to NPA. That is one reason. Second reason what we have done is we have reduced the pricing in the MSME segment aggressively during the current quarter from August. So 2 months of an impact was roughly around INR 150 crores reduction. Then there was an aggressive repricing in corporate -- short-term corporate book where people take WCDLs. So that book is more than INR 50,000 crores where repricing aggressively has taken place. So these are the reasons. Now how these results will prevail now or in the next quarter, there will be improvement. I'm expecting improvement in the next quarter because of the high liquidity only this problem has come, whereas the liquidity is slowly being removed by the RBI. And I'm expecting them to bring it down from 9 lakh crore to 2.5 lakh crore by December second week. As a result of it, there will be a little amount of hardening in the pricing and liquidity reduction. So our pricing will be moving in a better manner in the Q3 and Q4. So this was the detail what I had given earlier.

And what is the reversal because of slippages this quarter?

It was very low. Our slippage was, as I've indicated to you, 7,600, out of which roughly around INR 4,000 crores is only corporate book, INR 2,800 crores is 1 account, 2 accounts from Srei Group and around INR 700 crores from one account that is Entertainment City and one more account is around INR 200 crores. This is the corporate book. And the interest reversal, how much it is? 616 is the interest reversal.

Got it. And sir, would you have the segmental yields that you are earning on a normalized basis, excluding the impact across retail, corporate and MSME?

No, we haven't done that. Taking your feedback, next time onwards we'll do. But then when we are giving the yield and other things, it is only earning assets. We don't take a [indiscernible].

So for example, the yield on advances that we report is the number like 6.5%, right? So it's almost like very close to what we are earning on the investment book itself. So across the segments, just wanted to understand how is the deviation?

See, 6.85, which is appearing in the half year. If you look at the segment, corporate segment only will be very low. Retail and MSME still -- in spite of reduction in the rate, our yield is still much better.

Got it. And sir, second one was on the OpEx line, how should we look at the normalized run rate from here on?

Operating profit.

Operating expenses.

Operating expenses, see, if you look at, it has not been very high. Only very few areas where the expenditure look to be a little higher where I've indicated already. A couple of areas, one is in the segment of employees, another is other than employees. Other than employees, the AMC cost, cumulative cost has come in the current quarter, which was pending for almost 1, 1.5 years related to the amalgamation and the various license, which we have taken for the combined entity. So that is one of the areas. And then we have rationalized 750 branches during this period where we have completely cleaned with respect to the pendency related to lease payments. That was also one cumulative impact which has come. This will not be repetitive in the next quarter. So we'll be able to control normally in terms of the next few quarters, like what I have indicated, our operating profit could be anything around 5,000 to 5,500 even though the NPA will be booked to operating income area only. But still, the operating expenses, and then still, we will show the recovery from the rate of accounts in other income. So with that expectation next quarter and onwards, we'll be expecting the operating profit to be between INR 5,000 crores to INR 5,500 crores.

Got it. And sir, last one is what have we guided in terms of slippages and reductions for this year?

Right. I have indicated that if you look at our slippage now, it is half year, 13,700 roughly. If you look at gross slippage addition, it will be 2,500 more. That means Q1 slippage, 2,500, we've upgraded in Q2. So similarly, gross slippage for Q3 and Q4, we are expecting around 7,700 roughly. However, overall slippage will be between INR 16,000 crores to INR 18,000 crores. I'm expecting further upgradation of the slippage of Q2 and successfully like that.

The next question is from the line of Himanshu Taluja from Motilal Oswal.

Sure, sir. What is your total SMA overdue? As you have already given the SMA-2 number, if you can give your total SMA overdue?

Total SMA, if you look at -- INR 25,000 crores for INR 5 crores and above.

Yes. Okay. And below -- and below 5 crore...

For your information, it includes Air India, 5,500.

Okay. Air India was 45 billion or INR 5,500 crores?

5,500.

Okay. Sure, sir. And sir, this -- your SMA overdue below INR 5 crores?

Below INR 5 crores, sorry. No, SMA 0 also. If it is SMA-2 only overall, including about everything it is INR 12,000 crores.

INR 12,000 crores.

That is SMA-2 only I'm saying.

SMA-2 below...

Yes, below and above, everything, together INR 12,000 crores, excluding Air India.

The next question is from the line of [ Ajay Choudhary, ] individual investor.

Hello, can you hear me?

Yes, yes, I can hear you.

I have been a shareholder of your bank since 2018, when share price was around 200, and now it is around 42. And meanwhile, you have raised money from government and other sources multiple times to cover high NPA and to raise your capital ratio. So we are in a huge loss. What are the steps the bank is taking to ensure shareholders get rewarded? And when do you see that we can get to a point that you start getting...

Hello?

We can hear you sir.

Yes, that query is over? Question is completed?

Yes, yes.

Okay, right. So first thing is that I appreciate your capacity, still holding on to us because you told that you purchased at 200 almost into 2018. I do agree, if you look at from 2017 to '18 when the government has declared the capital inclusion of roughly 2 trillion, 2 lakh crore across all public sector banks, the prices have gone up. And afterwards, there were various developments with respect to PNB individually and with respect to other banks as a result of which share price has gone down. No, I'm not going more in detail into that. Now what is future I would like to put before you. September 2019 was the last when government has infused capital in Punjab National Bank. The amount was INR 16,016 crores or INR 16,062 crores roughly. Now afterwards, we are not going to the government. The reason why the price of public sector banks in general and PNB, in particular, do not move in the market is not a very big piece being available for trading in the retail segment. So that is the reason why consciously bank did not go for capital from government. In the last 1.5 years, we have gone for QIP 2x even though the valuation was low at that time, but we wanted at least good amount of piece to be available in the market, so the trading takes better. Now the value to increase over a period of time will depend on the perception of the market with respect to the performance what we have done and how we are going to perform for the future in the days to come. The INR 42 today is because there has been a reduction of roughly 9% as an immediate reaction to what we have declared the results as of yesterday in the evening. Otherwise, it was around INR 46 yesterday. I'm expecting that as per the investor discussions what do they take place, so we will improve from here our benchmark of 42.65 as indicated by the analysts we have crossed very recently. And now the bank is not expected to go down below that. And if you are talking about INR 200, probably I'm not having any reply as to when we will achieve that. But I'm expecting that in the next 1, 1.5 years, there will be a good value for Punjab National Bank because in many areas, we have bottomed out on internal things to clean the asset quality existing as well as bringing in better underwriting standards in terms of the future asset accretion what we are having. So based on this, I can assure you that the bank's position in terms of the share pricing will be much better in the next 1 to 2 years.

[Operator Instructions] The next question is from the line of Suraj Das from B&K Securities.

Sir, a couple of questions. So you clearly explained the rationale behind drop in NII for this quarter. I just want to know, sir, what will be the normalized level for NII from year 1 for the next couple of quarters?

See, I indicated about actually what we call the operating profit. Now with respect to NII, so the figure at the end of Q2 was 6,353. In Q1, 7,234 of the current year. If you looked at -- it was 8,455 in Q1 of the last year. But if you ask me the average level, it should be 7,200 to 7,500.

Okay. Okay. Sir, next question, just coming back to the restructuring question. So you have given 2 disclosure on Slide 14 as well as on Slide 32. So are this number additive? So let's say, I mean, the total restructured book will be 7,254 plus 10,244. And the figure on the Slide 32, which is 3,422. If I understand -- correct me if my understanding is wrong. So the total...

Slide #32 ever restructuring of the old, that is earlier restructuring where the MSME window was available, and other accounts were available there. That is what we have indicated. But the OTR 1, OTR 2 are different. So this is mutually exclusive.

So right. So then the total restructuring would be something around 2.8% of loans, which is 209 billion. So are additive of all this?

No, no, earlier, see, what is the other page you said?

Slide #14.

14. one minute. Slide #14, we restructuring, if you see 7,254 OTR 1 and 10,244 in OTR 2. So together, it is around 17,400 and this 3,400, 20,800.

Right. Right. Understood, sir. And sir, any nonspecific, I mean, provision, contingent position that you were carrying as of now?

Nonspecific provision?

Right.

No, if you say only -- see, in Srei, we are required to make 15%, additional 25% we have made. So total 40% we have made.

Okay. Okay. Understood. And sir, on the B1, so you recovered something around [indiscernible] crores. So how has been the accounting? I mean, all the recovery has been accounted as provision write-back or like the bonds, I mean, you're still carrying the provisions?

No, no. Provision write-back. There is nothing to be carried provision, while there is a requirement of provision, BHFL because the change of management and as well as it is a sell through the [indiscernible]. Bond is not continued or given by the DHFL. It is driven by what you can [ pyramid. ] And the market coupon.

All right. Okay. So the whole recovery has been...

1,270, we have provided 100%. So INR 1,270 crores of recovery has been a write-back in the provision.

Understood, sir. And the last question, sir, from my side. So on the DTA, sir, what would be the outstanding DTA number as of now? And sir, what are your plans on moving on to new taxation?

See, it is a high amount. Last time also, we have indicated around INR 4,000 crores to INR 5,000 crores, impact will be there on the PNB. And there are 2 ways of looking at it. The impact on capital will not be there. Capital impact is only limited to 17 basis points, one seven basis points. So it's not going to impact us. However, if you're book in entirety in the same year, it will impact the profitability where upon the dividend and other things will not be available. So if you look at the guidelines, it is not mandatory as of today. Any time it can be done. It can be shifted there. Of course, as today, there are a few banks like State Bank of India, Axis Bank and other banks who have shifted. We are just waiting for the right opportune time. If the permission is given generally by RBI for debiting to reserves, that would be the best option anytime we can undertake. But I'm not sure about that. However, we -- if everything goes as per plan in '22, '23, probably, we should be doing that.

The next question is from the line of Sneha from Shubkam Ventures.

Sir, just wanted to know what is the outlook on the credit cost from here on, considering they are expecting lower slippages as well as upgrades and recoveries to remain higher on the second half?

What -- the guidance what we have given was for the year '21, '22 will remain the same 1 point -- between 1.25 to 1.5. See, this quarter, it was 1.47. Last quarter, it was 1.72. So the averaging will reach roughly between 1.25 to 1.5. Later on next onward securities. For example, in Q3 and Q4, I'm expecting it could be around 1.1, 1.2. But the average will be around 1.25.

And how much slippages are we expecting from the restructured book that can slip going ahead?

Not much. See, as on today, as per RBI guidelines, if it is more than 30 days, you need to identify as an NPA, not 90 days. So 200 crores we have identified as on today, from OTR 1 when we have done the restructuring in the first stands as per the August 6 guidelines.

And how do we see the margins to be panning out over the next 2 to 3 quarters?

It will improve. Actually, this time, margin has gone down compared to the other quarters, but then it will improve.

And your cost-to-income ratio, sir? And I expect treasury will be maintaining around...

Predominantly, if you look at because income being low, the ratio is highly elevated, but we'll come back to the position of what we were there in June.

The next question is from the line of Ashok Ajmera from S&P Global.

I joined a little late because so many things are happening around. Sir, there is a little disappointment from looking at your [indiscernible]. My question is also [indiscernible] has not taken place, how the margins have gone down? I mean whether the interest rate that there on the existing loans? Or what is the reason for this one performance in this quarter of the bank, sir?

Right, right. Since you joined late, probably, you did not hear to what explanation I had given earlier. So I would like to repeat the same. There was a reduction in interest price for retail and MSME, but the impact was not very high. The impact has been INR 150 crores since this reduction took place in the month of August. So August, September together, INR 150 crores was the reduction out of this. However, the major reduction was because of the repricing of the short-term loans in the corporate book. Earlier, they were linked to MCLR of 1 month or 3 months. But in the last 3 months, there was an aggressive position of interest rate competition because of high amount of liquidity available. As a result, we had to offer linked to repo and linked to G-sec. This is the main reason. But this reason is going to improve in this quarter because the liquidity is slowly going down. Earlier, 90 lakh crore liquidity was there. Now it has already gone down to 7, 7.5. And I'm expecting further it to go down up to 2.5 by December second week. So in the process, the liquidity once it gets ready, the pricing also will be better.

The next question is from the line of Mahrukh Adajania from Elara Capital.

Sir, I just had a few. I just wanted a few clarifications. Firstly, what was your guidance for gross slippage stuff for the next 1 to 2 quarters?

What I've indicated was INR 7,800 crores of gross slippage -- INR 7,800 crores gross slippage, we are expecting in Q3 and Q4. Overall, if you look at H1, our slippage has been 13,700 or 13,600. But for the entire year, it will be between 16,000 to 18,000.

Got it. And net slippage will be?

When you say net slippage, what is the meaning?

Net of recoveries, upgrades, everything.

No, there is no -- it is recovery and upgrade only. After that, it will be around INR 16,000 crores to INR 18,000 crores. That is recovery and upgradation internally NPA identified during the year. Otherwise, if you look at the recovery and upgradation of old NPA accounts, and my slippage will be -- net slippage maybe 0 also, so if I have to understand your question properly.

Yes, sir. So I just wanted to know what would be the gross slippage without recoveries that, synergy, net of inter-quarter recovery, but without any old recovery or upgrade or write-off that...

See, if you look at it in the current quarter also, our upgradation cash recovery was around 9,126. And if you look at our first slippage, it is only 9,077, so even including the increase in the existing NPA. So that means our net reduction was there a little amount of around INR 50 crores to INR 100 crores. That means net, there was no slippage, if you're talking about that kind of discussion...

Yes. Yes.

So there won't be an addition to NPA that you can observe from -- in the last few quarters, the addition has been very, very limited in the net level. And in the next 3 -- next 2 quarters, it cannot be what it -- there will not be any addition done, it will be reduction.

Got it, sir. Got it. You did quantify INR 4,800 crores of the pension impact. But what is the actual contribution taken this quarter? You said it's over 5 years, but...

INR 253 crores.

253.

Yes. It is overall 3,800 divided by 5 years. And now since 3 quarters are there, once again, that factor divided by 3, we have taken this quarter.

The next question is from the line of Bhavik Shah from Morgan Stanley.

All the questions have been answered.

The next question is from the line of Jai Mundhra from Batlivala & Karani Securities.

Yes. Sir, just to clarify, I think this NII drop in first quarter, did we have some extraordinary income from Kingfisher or some other NPA accounts, which was there, which was actually -- which has bumped up the interest income in 1Q?

Yes, correct. INR 634 crores.

Right. So -- okay, right? So this quarter, we had a drop of around, let us say, INR 900 crores...

Correct. Out of 634 is that, another INR 300 crores is what I told you about repricing.

Right, right, right. So that is why the bump looks -- the drop looks much higher. Understood. Second, sir, if you can share rupees crore total nonstrategic provisions. So while you have provided additional on Srei, but that is always -- that has already gone in the hike -- in the rise in your PCR. So what is rupees crore of provision, which is sitting outside of PCR? Maybe on restructuring or something like it.

[indiscernible].

Sorry, how much sir?

In Slide #14, we have indicated INR 756 crores in OTR 1 and INR 1,033 crores in OTR 2 and other restructuring. So together, it is around roughly INR 1,900 crores to INR 2,000 crores.

Understood. And sir, if I were to break up your restructuring -- outstanding restructuring, 1, 2 and previous restructuring which was legacy restructuring, how much would be corporate, MSME, retail? Agri, I think, would be very miniscule, right?

Corporate is very low, INR 1,066 crores, which we have indicated on Slide #32.

Okay...

one minute. if you want to total the all the 3.

Yes, sir.

So 5,468 and 1,066 in. So it is INR 6,600 crores.

Right. So how much is the corpus sir?

6,600.

Okay. And how much is the retail and MSME?

You can see that remaining. And, for example, our total book is 17 4 plus 3, 20,800. So retail and MSME together will be 14,200.

Okay. And this includes even the MSME restructured scheme, right, which was started in January?

Correct. That includes everything.

So that includes everything.

Correct.

Understood, sir. And now, sir, in terms of your SMA, so I think you have given the SMA movement for currency data. But if you can share some perspective on the overall SMA for the bank? I mean, including below INR 5 crores.

Yes, yes. For example, SMA-2, above INR 5 crores, we have indicated around INR 9,600 crores, which includes 5,500 to Air India.

Okay.

So if you remove 5,500 from 9,600, it is only 4,154 which is above INR 5 crores. If you calculate for everything, all the accounts SMA-2 excluding Air India, it is 11,500.

Okay.

That is the latest position.

Understood. Understood -- And sir, just the last thing on the RBI master circular, which had said that recovery from write-offs should now be used as a credit to provisions, we would be shifting to that circular debt accounting by third quarter? Or there is some leeway?

See, there are 2 ways. One is that we are discussing at the RBI level. First thing is regarding M2M on investments, we have done that. Already, we have debited to our expenses only. So this is the only one even in the balance sheet of Q2, we have shown as other income. We will be observing from other banks because if you have seen the balance sheet of State Bank of India, HDFC Bank, they've also done like this. And they have given an indication there in the accounts. So no bank is so far done. We just wait and see from IBA. And if it becomes mandatory, then we will show that.

I think there are a few private banks and IDBI Bank has done starting this quarter.

I've not seen that. But SBI has not done. HDFC has not done. Canara has not done.

Understood, sir. And yes, that is this. Yes, sir. so that is all from my side today.

No, I thought we could adequately explain with respect to the decrease in NII and operating. Otherwise, if you have seen the entire results, these are the only 2 elements, which are probably today acted negatively in the price to go down. I expect that in the next few days, one of the analysts keep on talking the market will understand. There's no concern as far as our balance sheet is concerned, and I'm expecting the improvement in the next quarter only because of few issues. There was a high element of pressure because of liquidity in terms of the pricing, where we were losing the advances. Losing means the short-term lending, they will pay the money, and they will take from some other bank. So there was no choice but for us to offer the price at a lower level. As a result of this repricing, the income has gone down, but I'm expecting that this quarter it will be much better. However, we have shown net profit effectively as promised 1,105. And we still stick to our guidance of profit of overall anything between INR 4,000 crores to INR 6,000 crores for the entire year. And next 2 quarters, I'm expecting the better profit, maybe around 1,200 to 1,500 each.

Right. And sir, I believe whenever the situation happened, when there is a sharp drop between one quarter to another quarter in any of the line item, on PPT itself, sir, you can provide some qualitative thing? There was, let's say, in NII, there was INR 600 crore was clearly one-off.

Right.

That was -- they're in the base quarter. And similarly, in Y-o-Y this base quarter, there was one of their interest, this NPA interest was not be recognized.

Correct.

So that would anyway help other people. I mean, just looking at the presentation itself.

Absolutely, we'll do that. Thank you for your feedback.

Just sir, -- and last thing, sorry, on D1, so again, here, the noncash recovery that we have got in the form of [indiscernible] bond, we have taken that as if these are cash, right? I mean, the other way could have been you could have taken the bonds at negligible value. But we have taken same as, let's say, face value, right?

Yes, yes. I'd like to do -- there's no way you can do. See the point is whether you consider the cash recovery or otherwise, there are 2 elements of recovery. One element of recovery is cash. Other element of recovery is by bond. Now 1,250 -- 1,270 is the amount which we have recovered as against the amount of outstanding of 3,200, 3,688, overall including the investment. Since it was 100% provided, 1,270 was a write-back in the provision. There is nothing which has come in the income. Operating income, we have not taken anything. Everything is a provision write-back.

As there are no further questions from the participants, I now hand the conference over to Mr. Suraj Das for closing remarks.

Thank you. On behalf of Batlivala & Karani Securities, we thank Punjab National Bank management for giving us the opportunity to host the call. Thank you, everyone. Have a good day.

Thank you very much. Thank you.

On behalf of Batlivala & Karani Securities, that concludes this conference. Thank you for joining us. And you may now disconnect your lines.

Right. Thank you very much.