Satin Creditcare Network Limited (SATIN) Earnings Call Transcript & Summary

Ladies and gentlemen, good day and welcome to Satin Creditcare Network Limited Q2 and H1 FY '22 Earnings Conference Call. This conference call may contain forward-looking statements about the company, which are based on the beliefs, opinions and expectations of the company as on the date of this call. These statements are not the guarantees of future performance and involve risks and uncertainties that are difficult to predict. [Operator Instructions] Please note that this conference is being recorded. I now hand the conference over to Mr. HP Singh, Chairman and Managing Director of Satin Creditcare Network Limited, to give his opening remarks. Thank you, and over to you, sir.

Thank you for taking your time to discuss our Q2 and H1 FY '22 financial performance. I hope you have received our quarterly results and investor presentation by now. For those who have not, you can view them on our website and stock exchanges. During the first half of FY '22, our resilience and conviction has considerably helped us navigate through these tough times. Quarter 1 FY '22 was a challenging quarter, owing to the rising number of COVID-19 cases and the subsequent lockdowns. In Q2 FY '22, we witnessed economic activities gradually returning to normalcy, owing to the waning pandemic figures as well as sustained and widespread vaccination drives. For the period under review, the company adopted the right strategies at the right time, offering the right solutions to the people who required these solutions, which helped us arrest degrowth. In Q2, FY '22 disbursements started to pick up as things started to improve on the ground. Our disbursements for the quarter stood at INR 1,315 crores, as compared to INR 717 crores in Q2 FY '21 and INR 282 crores in Q1 FY '22. Additionally, the company has a CRAR of 22.3%. The company continues to maintain a healthy balance sheet liquidity worth INR 1,500 crores of surplus fund and has undrawn sanctions worth INR 323 crores as on 30th September 2021. With the improvement in overall economic scenario, we believe the worst is now behind us. On our collections, we faced some challenges on the ground in Q1 FY '22 due to regional lockdowns, restrictions; and the inherent nature of NBFC-MFIs' heavy reliance on cash collections for loan recoveries and need for physical proximity to customers for those collections. That posed a huge [ impediment ] under these circumstances. However, Q2 FY '22 saw significant signs of improvement due to the proactive stance by the government and policymakers, initiation of mega vaccination drives and good recovery in the services sector, along with growth in consumption and investment. Our collection efficiency is now 90% in Q2 FY '22, excluding Assam, showing major signs of improvement. Our nonpaying clients stood at 4% during H1 FY '22, as compared to 11% in H1 FY '21. As the current quarter economic activities seem to have largely resumed for most customers, we can say that we have endured the crisis well. The collection efficiencies have reached 96% during 1st to 22nd October 2021 and is inching towards pre-COVID levels. Disbursements too are close to normalcy. Over the years, we have grown steadily with a strong focus on customer centricity. We have patterned -- are underpinned by our technological integrated processes, strong domain knowledge, dedicated workforce and a strong team. Our core focus is to drive a positive impact on the lives of underprivileged communities and to empower and transform the lives of 29 lakh customers. Let me give you financial and operational highlights of our company. Our AUM as on 30th September 2021 stood at INR 7,381 crores. As on 30th September 2021, we have a customer base of 29 lakhs. Disbursements of INR 1,315 crores in Q2 FY '22 grew 83% Y-on-Y and 366% quarter-on-quarter, owing to waning pandemic figures as well as sustained and widespread vaccination drive. Disbursement activities are gradually inching towards pre-COVID levels. Stand-alone disbursement for the quarter stood at INR 1,103 crores, as compared to INR 632 crores in Q2 FY '21 and INR 222 crores in Q1 FY '22. For the 30th September 2021, our assigned portfolio stood at INR 811 crores, which includes INR 16 crores of housing finance portfolio. Net interest income for Q2 FY '22 stood at INR 171 crores, as against INR 184 crores in Q2 FY '21. For Q2 FY '22, our pre-provisioning operating profit stood at INR 53 crores, as compared to INR 80 crores in Q2 FY '21. For the quarter ended 30th September 2021, we have made provisions of INR 466 crores. Our cost-to-income ratio stood at 69%, while our OpEx-to-GLP ratio stood at 6.2%, which is expected to come down gradually with growth coming in. Broadly on our collection efficiencies. As highlighted earlier, we are witnessing improving trends in our collections on ground. Our month-on-month collection figures starting July are as follows: July '21, 86%, excluding Assam, 89%; August '21, 87%, excluding Assam, 89%; September '21, 90%, excluding Assam, 91%; 1st to 22nd October '21, 96%, excluding Assam, 97%. Collection efficiency in top 4 states stood at 93%. We have a well-diversified customer base, well-penetrated branch network across states and 75% rural exposure. Our on gross -- on-book gross nonperforming assets, GNPA, stood at 8.71% as on 30th September 2021. Our ECL stands at 8.67%. The rights issue of INR 120 crores launched in August 2020 is fully paid as on date. Total borrowings stood at INR 5,920 crores as on 30th September 2021. Debt-to-equity ratio stood at 4.2x. 59% of our borrowings are from [ banks ]. As of 30th September 2021, our total branch network count stood at 1,279 branches. Our branch network is spread across 400 districts in 23 states and union territories. As of 30th September 2021, 97.3% of our districts have less than 1% of portfolio exposure, which we aim to bring it down further in the coming time. All our MFI customers are women, 75% belong to the country's rural pockets. Our credit support empowers poor women in rural and semi-urban regions by encouraging entrepreneurship. Over the years, we have leveraged our idea of cross-sell products to these women and have been able to disburse close to INR 19 crores during H1 FY '22 under the product financing category, which includes loans for bicycles, solar products, home appliances, consumer durables and water and sanitation. An update on subsidiaries. The business correspondent services under Taraashna Financial Services has reached an AUM of INR 682 crores. As of 30th September 2021, the company operates 220 branches, has around 3.8 lakh active clients. Satin Housing Finance Limited has now reached an AUM of INR 246 crores, includes DA of INR 16 crores and has presence across 4 states with 2,711 customers. Satin Housing has 100% retail book comprising of 78% affordable housing loans and 22% of LAP. The company has 10 active lenders, including NHB refinance. Capital -- CRAR is 89.3% and gearing is 1.6x. Total equity stands at INR 100 crores. The company has knocked off all accrued losses since inception. Satin Finserv, our MSME arm, reached AUM of INR 138 crores, presence across 8 states, with 15 branches serving 2,296 customers. It's been profitable since last year despite difficult business environment. CRAR of 77.9%. Total equity stands at INR 107 crores. The Board of Directors of 2 wholly owned subsidiaries of the company, namely Taraashna Financial Services Limited and Satin Finserv Limited, at their respective meetings have considered and approved a draft scheme of arrangement for amalgamation of Taraashna Financial Services, transferor company, with Satin Finserv, the transferee company, and their respective shareholders and creditors under Section 230 to 232 of the Companies Act 2013 and other applicable provisions of the act and rules made thereunder. In line with our long-term strategy of diversifications, non-MFI book stood at 9.7% of AUM as on 30th September 2021. We have laid a strong foundation for both SHFL and SFL during last 3 years and have created valuable institutions. We will build and scale these businesses in a calibrated manner to create value for our stakeholders. Before we open the floor for Q&A, I would like to highlight that, as a responsible organization, we are consistently striving to make a positive difference in our stakeholders' lives by driving financial inclusion. We are guided by our long-term standing commitment of reaching the underserved section of the society. We are propelled by our utmost sincerity, compassion and long-term vision of offering support where it is needed; and are well poised to achieve growth and conquer the lost ground in the coming quarters. With this, I would like to open the floor for questions and wish you all a very happy Diwali and a prosperous new year. Thank you.

[Operator Instructions] The first question is from the line of Srijan Sinha from Future Generali Life Insurance.

Sir, just wanted to check what changed between August, when we had the last con call, and now? We had only 0.5% of our book restructured in August, and we did not have the inkling of this kind of a stress sitting on our book then. So what has changed between now and then?

So I think -- let me clarify first. I think the restructuring is not of stressed assets. These are all non-NPA assets which have been restructured. And we gave it time from June till September for the clients to recoup back their lost EMIs, but wherever the client desired that -- the scheme of restructuring which has been floated by the government be taken by them, I think they have availed that. And that is the reason why this has been restructured. And this is how it has been done. It was close to about 18,000 loans which we did restructure in H1, but the clients did want, after the lockdowns opened up, to repay their installments, but somehow if they were not able to do it, they wanted to avail the facility of restructuring [ them ].

Okay. And sir, what are the terms of these restructurings? Have you given any kind of moratorium to these clients? Or it is just the elongation of the tenure?

No moratorium -- it's the elongation of the tenure. That said, no moratorium is given.

No moratorium has been given, okay. And sir, second is -- so which means that, the collection efficiency that you calculate, it is calculated on the entire book and not just of the nonrestructured portfolio, right?

Yes, entire book.

Okay. Secondly, sir, do we have any recourse to the CGFMU guarantee scheme that most of our other competitors are talking about?

So the guarantee scheme, we have not availed the guarantee scheme for our borrowers, but we have received money under the central government guarantee schemes. We have raised about 350-odd crore till date on the guarantee scheme but have not taken anything for our borrowers.

Okay, which means that we have not invoked that or we don't have recourse to that guarantee scheme itself?

I don't think -- we have not done that. We have not done that for our borrowers.

Okay. And sir, my next question would be on Assam portfolio. Where are we in terms of collecting that -- collecting the overdue book there? What's the status of the bill that has -- that the Assam government has passed, the released bill? And what's our guesstimate in terms of what could be our potential recovery from it?

See, it's all [ broken ] process right now. I think the first list which was to be given to the government in terms of people who were paying absolutely has been given to them. The second list of overdue clients is now being prepared and being given to the Assam government. We are very hopeful by the MOU signing and the way the process is being handled by the state government, we are very hopeful that the money which has been overdue will be recovered. And let's wait for some point of time that -- see how this pans out, but we are very positive. We are very hopeful of the state government there in possibly giving us back the overdues and the clients repaying back their portfolio [indiscernible]. And we started our disbursements also in Assam, which also shows a sign of confidence in the [indiscernible] community across there in Assam.

And do you expect that to happen in this fiscal year itself?

Hopefully, yes.

Okay. Sir, my next question is on your capital adequacy. We have, of course, not grown our book over last 2 quarters, and yet our capital adequacy has declined from 25.3% in fiscal '21 to 24% in Q1 and 22.3% in Q2. We have not made losses in Q2, right, at least, so what explains the decline in the capital adequacy in Q2 over Q1? There is 170 bps decline in the capital adequacy.

So on that, our on-book portfolio is growing slowly. The DA and the BC book is going down, so to that extent, the capital allocation is there on that portfolio. So that's the prime reason. And we have made the additional provisions, because of which there's a tax disadvantage. Otherwise, the capital is intact now.

Okay. And...

On-book portfolio is growing. So that's the prime reason...

That is consuming the capital is what you are saying.

Sorry?

So that is what is consuming the capital is what you are saying. The on-book portfolio is growing versus the decline in the DA.

Yes, yes, right, yes.

Okay. Sir, my another question was on the P&L itself. Your interest income has declined by about INR 20 crores quarter-on-quarter. Has there been any interest reversals that has taken place during the quarter?

So there was a lot of overdues, and we restructured the book only on 30th September. So -- and generally, in microfinance we don't get interest for the delayed payment. And that is why, in spite of the flat portfolio, the interest income is slightly down. So there's a bit of yield loss because of delays, but things are improving. As the collection efficiency is improving, the revenue will start growing.

Okay. Sir, one final question, on the restructured book again. On the DA book, have we restructured anything on that book?

So that also has been restructured. We have taken the permission from all the DA investors, and we have got that and we have restructured that book as well.

How big was that, the restructuring?

We have taken the permission have -- from the investors and as we have done our on-book restructuring because, on the ground, people don't know which is on-book portfolio and what is a DA book. So we have to provide the same facility to all the borrowers. And all the, sort of say, banks who have done the DA transactions, they understand these dynamics. And then they have given us permission to restructure the book, so we have done that book as well. So there also the tenure is extended, as we have done for the on-book portfolio.

What will be the elongation...

Sorry to interrupt, Mr. Sinha, but may I please request you to return to the queue for your follow-up questions, as we have several participants in the queue waiting for their turn?

Yes, sure.

[Operator Instructions] Next question is from the line of Rishikesh Oza from RoboCapital.

Sir, 2 questions from my side. One is if you could indicate what will be the loan growth for the rest of the year and for FY '23 also.

Loan portfolio?

Loan portfolio growth, yes.

Yes. So we are targeting about an 8% growth for this year, and we are targeting close to about 20% growth for the next year.

Okay, okay. And my second question is, sir, our Q2 credit cost. Will it remain same for the rest of the FY '22 also?

So we don't want to give any guidance on the credit cost at this stage. We have given the details in our investor presentation that collection efficiencies across the country is improving, with Assam getting sorted out. I -- we feel that the worst is behind us, but probably...

And look at the key indicators which we mentioned in this year -- in the investor presentation of 4% nonpaying clients, declining from 11%. I think these are key indicative figures which probably give us an inkling how the credit cost will now pan out in the future. So I think these are the broad parameters which we have already shown in our investor presentation to the market the way how credit costs will pan out.

So fair to say our credit cost will be like less than what they were in FY '21.

See, that's what I said. There's no indication as such, but technically if you look at the broad metrics, we would be -- I think what Jugal said earlier. I think the worst is over for us. I think we're looking at future growth as well as subdued credit costs now coming in the future quarters as well.

Next question is from the line of [ Aditi Sawant from ADM Advisers ].

Yes. As most of my questions have already been answered, I have only one question. We have seen disbursements close to INR 1,300 crores in Q2 FY '22, which fairly indicates that demand is on track. So how do we see this planning in the quarters to come -- panning in the quarters to come?

So we've looked at composite growth of 8% for this year, which indicates that definitely, yes, the further quarters which are coming ahead will be good quarters in terms of disbursements. We don't have any indicative number. It's going to be better than what we've been able to do right now. So it will be better. So as I said earlier, basically the growth is back on track, disbursement back on track. And in fact, even collection efficiencies are back on track.

Next question is from the line of [ Bal Krishna from Action Now Investments ].

Sir, there is a charge in other comprehensive income for INR 35.46 crore. What does it represent, sir?

Sorry. Can you repeat the question?

Yes. There is a charge in other comprehensive income, right, for INR 35.46 crore. So I just wanted to know, what does it represent?

So since we have done direct assignment transaction in the past, as per Ind AS, we have to fair value the portfolio of -- so this is the difference of the portfolio on book and the fair valuation of that. So the credit cost is slightly inflated. There is a charge for the time being. As the portfolio quality will grow, the reversal will start happening.

Okay. So do you think that any of the amount that have been charged because of -- I mean valuation at fair value. So how much of this do you expect to be transferred to P&L in future? I mean above the line.

So look, the -- it depends on the collection trend and the write-off. This, we do at the end of every quarter. So this will slowly get corrected. In case the -- as the collection efficiencies are improving, the overall fair value of the portfolio will increase, and this will get knocked off.

Okay. My second question is related to the margin money. At the end of financial year 2021, okay, we had margin -- on the balance sheet, we had margin money deposit of 706 crore, as against the total loan and debt instrument and subordinated debt of 6,181 crore. So do you think this figure is high as compared to, I mean, generally market or the lender required to give to them, I mean, when you compare with your peers or something like that?

We do take ODFD facility. So in case we take an ODFD facility -- we at times, to manage our liquidity, et cetera, do that, where there is a lien marked on the FD. And in case we want to temporarily use a facility against that, we do that. It is not that we are offering that high cash margin for our borrowings, means overall cash margins are varying between 0% to 5%. In most of the cases, we provide onetime hypothecation of book, at times 1.05x. So it is not an entire security offer for the borrowing. It is part of -- it is ODFD facility.

Okay. And my last question is related to the high cash balance, I mean, as compared to the total -- loan outstanding. Do you think -- what do you expect to be the cash position throughout the year or at the end of the year?

You'll have to actually look at our history as such. So we've always maintained adequate cash balances across -- bank balances across the period of time. And specifically if you look at the way the pandemic have provided, I think for us this was a blessing in disguise which came in with the high liquidity balances we always carried. We had the ALMs probably stretching out to at least about a year when the pandemic hit, when there was no money coming in at that point of time. So I think for us this is in the range which we always like to keep it around in. And this is how it plays out in our balance sheet in all this...

[Operator Instructions] The next question is from the line of [ Devendra Pandey from DC Financial Advisory Services ].

So I have a couple of questions. My first question is on our average cost of borrowing. So as of today, what will be our average cost of borrowing?

So the blended cost is around 11.25% or so, but the overall borrowing cost for the first half of the year is a little over 10.5% because of the guarantee scheme. We have got some concessional funds also, but overall it's around 11.25% or so.

Yes. And what will be our estimate on incremental cost of borrowing going forward?

I think there is enough liquidity in the system available and we don't see any major disruption in the cost of borrowing at this point in time. It will broadly remain in this range only.

Okay, got it. And sir, my second question is on our secured portfolio, which is around 10% as of now. So are we planning to gradually move towards more secured portfolio? Will there be some shift going forward?

I think, exactly. I think you've put -- you've taken on the best point possibly be there. This is exactly what we are trying to do, that. So we are gradually taking our cue from an unsecured, which normally people call it the MFI portfolio, to our non-MFI portfolio. We are there, yes. We are looking gradually increasing this up and ramping up our subsidiaries and taking the non-MFI portfolio to a higher scale as such.

Next question is from the line of Ketan Saraf from SBI Capital Markets.

The first question I have is regarding to the restructured portfolio. I want to just -- I just want to see that for the restructuring which you have done in this quarter, what would be the sacrifice in terms of what will the hit that -- you have increased the tenure, so what can be the hit which Satin could get on loan book for this restructuring, which is around 1,100 crores?

So yes. So Ketan, let me just give you -- and then Jugal can probably add on it. Let me just give you a brief snapshot of what happened in restructuring one. So restructuring one, where we did our -- 18,000 loans were restructured during that point of time, 90% of them have started paying. So technically, if you look at by that possibility of -- because whatever have been restructured now, one, it is a non-NPA book which has been there. Second is, if you look at, take a cue from the restructuring one which was done for 18,000 loans where 90% of the people have started repaying and are back on the [ annual as such ], this is just an extrapolation of the figures which we can probably look about and talk about. That is what -- I just want to put that out. Jugal, if you have anything to add?

And as we have extended the tenure, we'll get the contracted interest on the extended period as well. So because of restructuring, there will not be any interest charged.

Okay, so there will be no sacrifice which the company will take on this case when...

No, no. So for the extended tenure also, we'll charge the interest.

Okay, got it. And in terms of building the AUM. Like -- the second question which I have. It's like you have added -- you have disbursed 1,375 crores of loan this quarter, but since then also the AUM has declined, so what is the particular reason of this balance?

See, you'll have to just give it a shot on the ground basically because, the moment lockdowns have started finishing up in June, you just can't pick up the disbursements in one go. So probably the quarter itself was probably bifurcated within 2 parts when the lockdown was still coming off of phase as well as when near normalcy was recovering on ground. And that's the reason why I think it is still slightly flattish in terms of this thing. I won't say that 3% degrowth technically will be there, but once we get a full quarter on, this -- I think this will start improving from thereon.

All right. So does that mean that around 1,000 crores of loans got matured? That's why the AUM is like -- is only at a 3% degrowth.

So the normal repayments are coming. We used to disburse close to around 600 crore a month prior to COVID. So as the disbursement has started picking up, the portfolio will also start growing in the subsequent quarters. As Mr. Singh said, that we are aiming for roughly 8% AUM growth for this year. And most of the growth in microfinance happens during the second half of the year. So things are on track. Overall collection and ecosystem is improving, so portfolio will start growing...

And also it's been 1.5 years since any fresh real growth has really kicked in because of the COVID. So I think there will be cases which will be finishing off in different years will be there, but that challenge, I think, will evaporate once the full-disbursement quarter starts happening, which is going to be from this quarter onwards.

Yes, sir, understood. And just last one question: It was, this was regarding the other comprehensive income, which one of my friends also put up. So every quarter, we are recording this 30 crores, 40 crores of balancing figure with the quality. So like you said that it would be reversed once the quality improves. So like just I wanted to know what is the -- from the next quarter, you are assuming that some of this amount should recover.

So as I said earlier, that we revalue the portfolio at the end of every quarter because -- this second quarter was -- also there was the overhang of the first quarter collection efficiency, performance, et cetera. So this will happen slowly over a period of time. The collection efficiencies are improving. So to that extent, the valuation fair value of the portfolio will also improve. Whether the entire 36 crore will go away in 1 quarter or not is slightly challenging to say at this point in time, but as the collection efficiency and the portfolio quality is improving, the fair valuation will improve. And to that extent, this will get reversed.

Next question is from the line of [ Manish Dhariwal from Fiducia Capital Advisors ].

Sir, we are -- sir, we understand that these are tough times. And these are times where one really needs to kind of take all the steps possible, and I can see that the company is doing those. Now my desire is to understand that -- see that -- is the complexion of the company changing over the next 3 to 4 years? Because the initiatives that you are taking on, this creating a secured book; the initiatives that you're creating on the other side; and the restructurings or mergers, demergers that you are doing, so please give us a flavor of what Satin is going to be looking like, say, 3 years hence or 4 years hence in terms of the NIMs that you will be targeting, in terms of the book size that you will be targeting and in terms of the complexion of the book. That -- and this is basically as of today's plans of yours. We understand that it could change. Things can alter, but obviously what is the understanding and the plan today?

Yes. I think -- so what you rightfully ask for is what I would like to maybe put it over here across for everybody's interest; is yes, it's not a quarter-to-quarter game which normally people try to look at. For us this journey started about 3 years back when we actually made our subsidiaries across over there. We have now reached a cusp where these subsidiaries have started firing on in terms of our product as well as our portfolio, which is different from just being a pure microfinance institution. And this is now taking shape in terms of how we look at the future in the next forthcoming years, of how Satin pans out to be with -- along with the subsidiaries across over there. So then as we said, 10% non-MFI portfolio means that, yes, the exponential growth is going to be far more positive in terms of our non-MFI book, as compared to MFI book. The MFI book will also grow, but the base is pretty large. I think the chances of the non-MFI growth is going to be slow, but yes, definitely that change is going to be there. That's one. The second part is when we looked at the way we are trying to amalgamate and try and bring up our subsidiaries together. And that's the reason why the BC book was merged into our MSME book, because for us that's how we are looking at housing as well as MSME and the other product lines along with -- sorry, along with the other asset class in the SFL book to probably also come up in terms of the way microfinance has panned out in the years which have gone by. So that's exactly what our whole thesis is. And we really want to monetize both our subsidiaries in the coming future and look at microfinance portfolio as also one of the product lines which are there going across.

Just to kind of take this conversation forward, with your permission: What is -- so say 3 years hence. What do you think is going to be the complexion of the book in terms of the categories?

See, we are -- I can't probably give you much forward-looking statement, but I can probably say, yes, it's going to be -- fairly be very -- significant in terms of where the percentage will stand. But yes, I think, in the next 4 to 5 years, we are looking at maybe a 2/3, 1/3 kind of a scenario or maybe something like that [Foreign Language].

Right, sir. That's very helpful. So what will the blended NIM look like?

See -- and I'm -- I, like, will not know affordable housing also, if I just can give you a cue. For us, technically we are not in that section. Again, our [ microfinance plus borrowing ], which we look at again people who are there in the rural [ pocket with ] rural housing to a large extent. Over there, as compared to the other housing book, I can just give you probably a broad indicator. It's normally the yield rates are close to about 12%, 13% at the max, which is -- but over here, our housing portfolio is at about 15.5% to 16%. So that's how we are looking at the asset class in our subsidiaries also moving forward ahead. So it will be -- they will be worthwhile in terms of our yield as well as [indiscernible].

Okay. And so -- and sir, so the next -- a point that emerges from this is that, see -- we've been an MFI organization. And the team, the processes, the whole thought process has been created around that. Now on a tactical basis, because of the events that were out of control, like COVID, you did not know, I did not know it is going to happen like this. Assam, we did not know something like this was going to happen, but then these things happen. But what you are now looking at is changing the complexion of the organization. And what do you think is going to be the bearing of this on the cost structure of the company? Because you will have to create a new cost structure for this.

No, I don't think so. That's what I said. If you look at this: We've already spent 3 years of our life, 4 years of our life on housing and MSME. So for us, we've understood what the technicalities of the games are, everything which is there. We have identified that. And the other thing which I would like to also put across is we just didn't want to remain just a pure, pure monolithic product of microfinance. So a vast bouquet of financial services is what we are probably looking at, so Satin just doesn't become on the top just being an MFI. We want to also enter the other asset class which we feel are also very necessary things to be done in the financial services sector. And that's what we've been able to create in the last 3, 4 years; and we take this forward across over there.

So what will be the geographies of focus, say, 3 years from now? Meaning where your asset book will be concentrated.

See, our leverage in terms of geography has always been very diversified in terms of 23 states. So you can very well imagine, once the infrastructure has already been created, for us to leverage that infrastructure, both our subsidiaries, will also -- an easy task, not -- a difficult ask for anybody who will be starting new in this space across over there. That's the big advantage which we have.

Maybe we can have a detailed discussion offline. And I can see you have a lot of questions. I'm happy to discuss this at length.

Okay, ma'am. So how do I go about it?

You can get in touch with me. And I will announce at the end of the call how to get and make -- contact us. So -- and then maybe we can discuss further.

Next question is a follow-up from the line of Srijan Sinha from Future Generali Life Insurance.

Yes. Sir, just 2 small questions. One, what is the status of our SMA-1, SMA-2 book? How big will they be, the overdue book?

We have restructured most of the -- not restructured. So we have restructured most of the book which was eligible and standard. So SMA PAR 1 is close to around 9.7% or so.

PAR 1 is only 9.7%, which is only 100 bps over the GNPA...

Yes, yes.

Yes, okay. And sir, my second follow-up question is on what's the kind of FLD that we would have given to our DA investor.

So in DA, we have no risk participation. It's a true sale transaction. Whatever we have sold, we are left with no risk. As per the guidelines, we generally keep 10% of the portfolio, but that is our on-book portfolio, part of our on-book portfolio. But on the DA book, we have no risk here.

And not even on the securitized part of portfolio?

Securitization is part of the on-book portfolio that does not meet the true sales criteria, but that's part of our on-book portfolio and we do whatever...

And that is anywhere less than 800 crores; and part of the SMA that is shared with you, in the numbers.

Ladies and gentlemen, we will take our last question for the day today, which is from the -- a follow-up from the line of [ Bal Krishna from Action Now Investments ].

Sir, you have totally disbursed 6,500 crore from quarter 2 of financial year 2021 to quarter 2 of financial year 2022, so what is the GNPA on the post-first-wave disbursal?

We don't have that...

Current GNPA, we have.

Current GNPA, we have, but if you technically want to take a look at that, I think we can probably calculate it and get...

But anyway we will always declare on the current portfolio.

Yes. So on the blended basis, the 9.7%, the new book is strongly performing much better than the old portfolio. But blended basis, GNPA, we have already given the number and...

And I think this whole book probably would comprise majorly what we have right now. So I don't think so -- there could be anything which is left from April '20 beyond that, so...

So I can safely assume or conclude that the -- whatever the GNPA percentage is there, majority of that comprises from -- comprises of new disbursal after -- post first wave.

No, no. This could be...

So the new disbursements are roughly 70% of the portfolio. And we have given the overall GNPA and collection efficiencies, but that gives you the entire picture.

So this is inclusive of the first wave also...

Yes. So since first wave, whatever we have disbursed, that comprises of 71% of our portfolio outstanding.

Thank you very much. I now hand the conference over to the management for closing comments. Over to you.

Good morning, everyone, once again. I thank you -- I thank everyone for joining this call today. And I hope we've been able to address all your queries. For any further information, you can get in touch with me. My name is Aditi Singh. I handle the investor relations for Satin, and my e-mail and phone numbers are there on the website for you, in case you don't have my coordinates. You can also get in touch with Strategic Growth Advisors, who are our investor relations advisers. Thank you all. And wishing you a very happy Diwali and a prosperous new year. Stay healthy. Stay safe. Thank you.

Thank you very much, ma'am. Ladies and gentlemen, on behalf of Satin Creditcare Network Limited, that concludes today's conference call. Thank you all for joining us, and you may now disconnect your lines.

Thank you, Dan.