Repco Home Finance (NSE:REPCOHOME) Q2 2027 Earnings Call

0:07 Ladies and gentlemen, good day, and welcome to Repco Home Finance Limited q two FY twenty seven earnings call hosted by YES Securities Limited. Please note all participant lines will be in the listen only mode. There will be an opportunity for you to ask questions following the conclusion of the management's opening remarks. Please note that this conference is being recorded. I now hand the conference over to mister Rajiv Mehta from US Securities. Thank you, and over to you. Yeah. Hi. Good afternoon. Thank you, everyone, for joining us, and thank you to the management for giving us this opportunity to host the second quarter earnings call. We have with us mister T. Karuna Karan, MD and CEO, mister B. Kanan, full time director and chief development officer, mister M. Raja, chief business officer, mister A. Palapandi, chief operating officer, mister Ankush Tiwari, company secretary and compliance officer and miss Shanti Shikanth, chief financial officer.

1:06 Mister Karunakaran, sir, will start with his opening remarks, and post which, we'll open the floor for questions. So open to you, mister Karunakaran. Yeah. Thank you, mister Rajiv. Good afternoon to everyone, and I'm extending warm welcome to this call to discuss our September 2026 performance and way forward. Thank you for joining. The detailed results are in the in the investor presentation on our website. So I'm not going to read every number. Before discussing the current quarter... I mean, September 2026 performance, I would like to go back. I would I would like to recollect the efforts taken by the company to improve the business in terms of increase their disbursement, to increase the AVM, to reduce the NPA and other stage assets.

2:16 Technology side, we have revamped our technology side. Digitalizations, we have carried out. We have also implemented an entire digitization program. Actually, we are carried out the digitalization program in two phases. Phase one consists of implementation of core application, and the phase two consists of supporting applications. Core... I mean, core applications, we have implemented, mobile applications we have implemented. We have also integrated our software with, like, other software like and other civil, etcetera, to improve the turnaround time.

3:07 Second thing, we have done a verticalization in our company. A yearly branch, it is responsible for the... All the activities, which is having its own limitations. We want it... Want to take this company to next level. Verticalization is... Or verticalization or specialization is required. We have done verticalization in our company. We have introduced separate vertical for sales, recovery, collections, operations, credit, and and given management. Third, last two to three years, we opened almost approximately 50 branches across the country to reach out to people.

4:00 This year, we want to open another 12 to 13 branches across the country. Majority of the branches will be in non TN. These are the initiatives... Few initiatives we have taken in last two to three years. The the results are now the... I mean, all... Almost building a strong base of Repco is completed. The... Now we are... Our focus is growth and aggressive growth, which is savings from the disbursement number. If you look at our disbursement number since September 25, some... We crossed a thousand crores disbursement per quarter barring June 26 last quarter.

4:52 Last Last quarter, we had a lot of, I mean, transfers and promotion exercise we carried out, which is likely affected our June 26 disbursements. And now all the transfers... What are the transfers we have put in first quarter? All the people are settled down the... Their paces. They started to leaving the business. Disbursements are increasing. We have seen substantial improvement in asset quality in terms of protection in NPA and stage two assets. As end of September twenty twenty six, our AAM stood at 16,425 crores, which is almost up by nine to... 9.2% year on year basis.

5:50 Our sanctions has end of the September for the year ended. I mean, for the quarter ended to that thousand 359 crores as against the thousand 205 crores the corresponding year of previous year. Again, our disbursements, we have crossed a thousand crore mark. We have done a disbursement of thousand 205 crores in September 2227 as against disbursement of a thousand 69 crores in lost financial year. This is on business side.

6:39 We have seen substantial improvement in the asset quality. Our gross NPA as end of September twenty twenty six stood at $3.96 crores as against 474... 475 crores in last September. Our gross NPL stood at 2.4%. We have seen substantial improvement in stage two assets also. As end of the September, our stage two assets stood at thousand 154 crores as against the thousand 354 crores in the corresponding period of the previous year.

7:27 Our provision coverage ratio stood at 66%. It's only our performance in NPS side as on core asset quality side on our last... I mean, September 2026. Our book remain well diversified. We have not seen any change in the salary... Significant change in the salary on... And the HR versus non HR. Our book is well diversified. As end of the September, out of total book, salary class accounted for almost 53.6% and non salaried...

8:16 Sorry. Non salary account for 53.6% and salary accounted for 46.4. The mix of home loan versus home equity remain constant. So out of total AUM, 71% of our book... AUM is housing loans. Remaining is a non HL. Of course, 29% is a non HL. The entire of the entire AUM is retail. Right now, we don't have any exposure to build a loan. The average ticket size is... Incrementally, it's about 23 to 25 lakhs. And about overall book, it is about 14 lakhs.

9:09 Almost 57 percentage of the book is coming from TN. Remaining is from non TN. We have taken steps to... Initiatives to improve the non TN book. Going forward, I'm expecting books from other states will increase. Coming to the boring side, last year, we started diversification in liability sites. We have done NCDs, CPs, and p... PTCs. Our borrowing cost has end of the September stood at... Overall borrowing cost stood at, eight point, three by...

9:57 Out of, total borrowings, almost 86% of the funding is coming from banking system. It's, of course, not depends on one or two banks. It's spread across almost 19 to 20 banks. 7.2% of the funding is coming from National Housing Bank by way of refinance. For current financial year, National Housing Bank has sanctioned 600 crores refinance facility to us. Out of 600 crores, q one, we have taken 106 crores, and q two, we have taken $1.25 crores.

10:44 Remaining amount will be utilized based on our need. NCDs and PTCs accounted for almost point 7% of total borrowings, and Repco Bank funding is... It's about 1%. During the q two, we have raised 75 crores funds through way of issuing commercial papers at the rate of 7.6%. We then pass through certificate also in September. It's a pass through certificate. It's worth about 74 crores. The cost of ending of pass through certificate is about 7.9 percentage.

11:40 These are different borrowing side. Coming to the profitability, our cost of... And I already told you, RIM stood at 8.35. Return on asset, it's about 11.83%. So we are maintaining a spread of 3.4%. Our benchmark rate, the... Or otherwise, we used to call them min... Minimum lending rate. The... Our minimum lending rate is is about 9.9% depending upon the borrower's risk profile and the interest rate vary. The average yield what we are getting from salary class customer is about 11.25, and from non salary class customer is about 12.07%.

12:42 The return, what we are getting from housing loan portfolio is about... Average is about 11.07. We are getting a yield of about 13.32% from non housing loans. These are the... Our performance in spreads and NIM. Our NIM stood at about 5.4%... 5.44% as end of the September. Coming to a profit, our net profit for the quarter is about 116 crores as against 114 crores in the previous quarter.

13:41 Last September, our profit stood at about close to 106 gross. ROA as end of the September was about 2.9%. It's almost stable. Even June quarter also, it's about 2.9%. ROE is about 12.54... 55%. We are having a strong capital adequacy ratio. Our capital adequacy ratio is about... Close to about 37... Close to about 37%. We are having adequate capital to grow. Also, we have accelerated the disbursement.

14:27 We have taken a lot of initiatives, steps to improve the disbursement. Our sourcing... We have increased our sourcing channel. We have recruited substantial amount of DST, and we have introduced a connector model. DSH channel also become increased. So going forward, our disbursement will go up. We are also some... Controlled our BTL. Last one caller, I said, we are going to sacrifice some portion on spread to retain the good customer. We control the BT out. This are the from profitability under that side.

15:14 Our credit cost to debt 0.1% as compared to negative in the previous year. Coming to the branch network, right now, we are having 242 branches across the country, including SAT Center. This year, we want to open another team to 14 branches. Majority of the branches will be in non TN. These are the about our performance in short. I'm very happy to say that our board has approved a interim dividend of 5 rupees per share, the face value of 10 rupees.

16:06 We... Going forward, last May con call, I had given I had given you guidance of both disbursement of thousand 200 crores for September. And I said, we want to bring down our NPA to below, I mean, March level. Yes. We have done September our disbursement. We have crossed the disbursement of a thousand 200 crore mark, and we also brought it down brought it down our NPA to 398 crores from 426 crores as end of the June 2020. Six... Going forward, our priorities will be acceleration in disbursement.

16:57 The same time, we want to maintain quality in the asset for this growth. We will not dilute the quality. And we want to diversify our liability side more. We want to avail more refinance from National Housing Bank to reduce the cost of fund. And our another top priority will be improve the operating efficiency. These are the other priorities. We thank... I thank each one of you for joining this call. Now I'm opening session for q and a.

17:43 I'm happy to answer the questions. Over to mister Raj. Thank you, sir. Ladies and gentlemen, we will now begin with the question and answer session. Anyone who wishes to ask a question may click on the raise hand icon from the participants tab on your screen. We request participants to restrict to two questions each and then return to the queue for more questions. To rejoin the queue, you may click on the raise hand icon again. We'll wait for a few minutes until the question queue assembles. Requesting participants. If you wish to ask a question, you can click on the raise and icon from the participants tab on your screen.

18:42 We'll wait until the question queue assembles. Yes. We will take our first question now. We have Darshan Devra. Darshan, please go ahead with your question. Yeah. Thank you for the opportunity. So just wanted to know what is the guidance for disbursement for q three and q four?

19:33 Our guidance for... See, for current timing, q three disbursements is about thousand $302,003.50 crores. For q four, it's about a thousand $6.50 to thousand 700 crores. For this current copier, we want to achieve a disbursement number of approximately 3,003 thousand to 3,050 cross. This is on disbursement side. Coming to NPS side, our guidance is... Let's click on my guidance of what I have given post March 3025. Six results. Guidance for NP is to bring it down below 2% by year end.

20:25 Got it. And how is the October quarter? What was the disbursement that we did in October? Yeah. The disbursements are x... In line with our expectations. I said for this current quarter, we want to do do a disbursement of thousand $302,003.03 50 crores. It's October October disbursement as well as the disbursement till date. They make confident that I'll be in a position to achieve the number what right now I am just now committed. Got it. Got it. Got it. Great. I mean, I I appreciate that. One last question on the credit cost. So, you last know, year, I think we had negative credit cost, right, for for the last part of the year.

21:11 And this year, what are we expecting in terms of credit cost? And what do you think, you know, like, in terms of pad growth? What sort of pad growth can we end up with this year? We're coming to this predict cost. See, actually, we have... See, our June NPA was about 427 crores, which we brought it down to $3.97 crores. We got a, of course, reversal in the provision. As a matter of prudent, we have not done any reversal. We have appropriated to other NP accounts. Going forward, current quarter as well as next quarter, I'm expecting charging to the provision to the extent of 5 to 6 crores in p and l.

22:00 And this is on our provision side. Profitability side for the off year, our profit... The... For the current off year, our profits were at almost 230 crores. I'm expecting a profit for current financial year in and around close to about $4.92... $44.90 to 4... $4.85... $4.80 to $4.90 crores. Yeah. Got it. Thanks. That's very helpful, and good luck for the remaining quarters. And very heartening to see that, you know, you've achieved your guidance, which you had given out, you know, for 1,200 crores of disbursement. So congratulations to the entire Repco team, and wish you a happy Diwali, happy Dantiras, and good luck for the balanced quarters of the year. Thank you.

22:55 Thank you. Thank you so much. We'll take our next question. We have Mr. Abhijit Ibrahimal of Motilal Oswal. Abhijit, you can go ahead with your question. Yeah. Am I audible? Yes, Abhijit. Yeah. Yeah. Thanks. Good afternoon, sir. So just two things. One is you just gave out... You just spelled out the guidance on disbursements for three q and four q. I think that's a very heartening thing to hear the numbers that we are targeting in terms of newer business in the coming quarters. But I just want to pick your brains on one thing. I remember asking this to you same time last year as well, that in the past, we typically used to have three q disbursements, which were lower than two q. Then last year, I remember, we marginally inched up from where we were in two q. Three q disbursements were marginally higher than two q last financial year.

23:58 This year, I think we are talking about a very good increase from two q levels. So so that is the first point that what used to be there in the past, which didn't allow us to do a lot of business in three q, and what has changed now, which is giving us that confidence. And then, again, on the fourth quarter disbursement guidance that you've given out, I think, I mean, again, very heartening to hear very strong business aspirations and targets that you put out. So in addition to what you spelled out in your opening remarks, which is this additional DSP hiring connector connector channel. So what what exactly is giving you confidence that we'll be able to deliver that... The numbers that you just spelled out? And so lastly, if I look at the OpEx this quarter, it was, I I think, slightly elevated.

24:49 So unless you've covered something in your opening remarks, which I missed because I joined a little late, for the benefit of all of us, if you could let us know what led to OpEx being slightly higher than what was expected. Yeah. Yeah. I'll answer second question. First, because first question, my colleague, mister Raja, will answer. Yes. Slightly, our effects is slightly limited compared with June. You know, with that, our June, our disbursement number was... We have not achieved the the target. We said we set a target of... Internal target of close to about a thousand close disbursement for June quarter, but we have done about 843 close. So I... We have not paid the incentive for the first quarter.

25:40 So we... I told my people that you increase the disbursement, you increase the business, you will recover more. So we'll pay for the incentive for the June quarter along with September. Yeah. But people have done good job in terms of both... In terms of disbursement, new bookings, as well as reduction in NPE, reduction in stage two. So I paid the incentive. That is one of the reason for increase in the salary cost. Number two is last quarter, we have done a dock provision for retirement benefits, funds like graduate...

26:25 Graduate leave and cashment. We have done a dock a dock basis based on our experience. This quarter, we collected actual evaluation for both gratuity as well as a leave and cashment. We have provided more. Of course, we have invested in staff, recruited brand sales manager, and, I mean, recovery people for to improve the performance, which resulted in increase in salary cost. Number three, we have given annual increment. We have given to all the stock, which is based on purely performance, which will vary from 5% to 10%.

27:14 These are the reasons for increase in salary cost. Coming to the administrative cost, marketing expenses like DSA payout being... Because disbursement number is gone from 800 crores to $88.43 crores to a thousand 205 crores disbursement become 10. Our disbursement numbers is increased. So sourcing cost also slightly increased. This cost to income ratio will stable at this level. Coming to this Yeah. So I will take the first part of the question. On what is the difference that we have done between q three and q three, why the trend is broken now or breached now. It was it was through organic development wherein we had invested quite amount of efforts on building the channels.

28:14 So now we have an independent sales channel, independent credit channel. So now that that that there is no overlap of responsibilities and hence, the concentration and focus on business is good. That that that is that is the change that has happened, and that is the confidence that we have in saying that, yes, I'll be doing more than my q two. Got it, sir. Got it. Hope you answered your questions. Yes. So that answers my question. Just one one more thing I wanted to understand is now that we are in a rising rate environment, seen a 25 bps report rate hike, and and there are potentially more which might come in the subsequent months, what is the sensitivity of our cost of borrowings to, let's say, a 25 or 50 basis points rise in the repo rates. So, basically, what I'm trying to understand, how... What is the the mix like between fixed and floating in our in our liabilities?

29:13 And likewise, on the asset side, have you taken any PLR actions, or are you contemplating anything? Subsequently, what impact we could see in the margins in the coming quarters? Yeah. Coming to the mix, the liability side, our entire liability is floating except some... A few amount to what we have taken from National Housing Bank, which is a special scheme. It's a special rate. Barring that, our entire liability is on floating side... Floating rate. Coming to the asset side, our entire asset is fixed... Sorry, floating. We don't have any fixed kind of loans in our asset side.

30:05 The entire asset is subject to repricing of once in once in yet three months. With the time lag of three months, I can pause on to any decrease or increase to my borrower. As end of the September, a cost of fund that stood at the... Overall, I'm talking about overall cost of fund. It's stood about 8.35%. Yes. Post RBA rate hike, we have seen increase in our borrowing cost. Going forward, I'm expecting cost of fund may go up by at least 10 to fifteen fifteen basis points. I will pass on this increase in cost of funds to my borrowers with the time lag of about, say, one quarter one quarter.

31:02 On the other side, the refinance, they sanctioned the 600 crores refinance to us. I already taken about 206 in first quarter and 25 in second quarter. Remaining amount based on the funding requirement, I am going to avail. So, Tim, so whatever increase I'm I'm going to experience in cost of funds will be passed on to our borrower with time lag of about one quarter. Second thing, PT to our control, the PT out, protect the good customer. What I... What... I mean, I mean, return and quality will not come together.

31:48 To retain the good customer, we have to pause some concession to them. Those who are with us for at least two years, having good record, good track record, good civil score, and having a trade off moving out of our company. We need to pass on some rate benefit to them. So keeping all those things in mind, in near term, my... Right now, am maintaining a split of close to about 3.4%, keeping this borrowing cost increase and giving the benefit to the existing customer to arrest the BT out. I may have a... My spread will stable at... In and around 3.25 to 3.3%.

32:44 Got it. So that answers all my questions. So thank you so much, and I wish you and team repco the very best. Thank you. Thank you. Moving to our next participant, we have Vinod Vyas of Share India. Vinod, you can go ahead now. Good evening, sir. Just one question from my side. Because major of our exposure is in South. So are we facing any stress in the housing loan in South, in Karnataka or Delhi, is it? And the demand No. No. We have not. No. We have not any experience there in any stress.

33:36 Of course, we have seen improvement in disbursement in Karnataka. Q one, our disbursement in Karnataka is slightly below the normal disbursement. For q two, we have seen improvement disbursement in Kanataka, but we are not seeing any stress in South. So so in current month, I'm going forward also. You are seeing no stress. Right? No no stress from there? No. No. We have not seen any kind of stress in South. Okay. Okay. Thank you, Thank you, Vinod. We'll take our next question. We have Harshita of Pream g Investment.

34:22 Harshita, we have... Yes. You can go ahead now. Hi, sir. Sir, thanks for a decent quarter. I had a few questions, sir. One, the... With the... If I look at the last four, five years for Repco, the challenge has been more on the growth piece itself that... I think... And probably how to exactly... If you can help us articulate that, what were the changes that the growth is now seeming a bit more... That you guys are sounding a bit more confident on that number, that 1,300, 1,600 kind of a number. So if you if you can double click that, say, have we upgraded some of our... The technology, the incentivization of sales team, DST as a channel, if you can also help that, how can that be a reasonably stronger growth either? So just just to gain confidence on that piece itself.

35:22 And the second thing is, sir, more... Within September, we saw the reputation change from Repco Bank. Yes. Right. Then at the end of month, we've been a very short period, and comments are... Had come up. Now just wanted to understand that that is also aligned with now that Repco Bank being aware that probably in the last four, five years because of many reasons, would be lower spending on tech, a bit of bureaucracy that the growth was... So I think the Repco Home Finance was not able to grow to its potential. And are they acknowledging those things and working towards so much... Towards the potential of their Repco Internet can grow?

36:08 This is it. Just wanna understand the the reputation and the thought process of the Repco Bank with the respect to their funding finance subsidiary. And, obviously, the first question is more, what gives us that confidence of the number which you are seeing for p two four two? Like, I think, more not adjusted the guidance, but but what are the processes that are giving us that confidence? Mister Raja will answer first question on business side. Mister Raja? Yeah. I'm there. Yeah. See, all the points that you mentioned, whether you have done, I would like to say we have done all those points. Like, we have we have developed our sourcing team. We have developed our DSA channel. We have developed our DDST channel. Now the branches are more confident in picking up the cases.

36:57 Our processing team has helped us through. So there has been a lot of changes in the process also in the systems. The systems also we are going to add that the LMS has now stabilized, and we are also having an... We are we are in the process of giving an... A mobile app to my sourcing executives. So we have we have we have got into the track of the... Getting getting things done through technology and also concentrating on the sourcing channels and increasing our penetration. So that is what is giving us the confidence and committing numbers. And that numbers is... That that growth is showing in the numbers whatever you you are pursuing from your side, thankfully. In addition to that, we have also... I mean, revamped our entire incentive structure. We have introduced this special incentive for improve the sourcing channel.

37:49 With this all initiatives taken by the management, I'm confident that there will be no pushing to the... Achieve the disbursement numbers. Just now, I've given as a guidance for current quarter as well as next quarter. Coming to the deputations, mister deputy deputy... Deputation... I mean, deputated from Repco Bank for the company for three years. Almost he's completed about 2.2 and close to two and a half years. I guess it done a... Really acknowledge its performance. He has done a good job in recovery side. Since Repco Bank, this... I need these services, So they withdrawn deputation from our companies. They posted mister Khan, and he's also expert in the recovery handled...

38:42 I mean, imported portfolios in Repco Bank and added a few... I mean, big branches in Repco Bank. No specific reason for withdrawing deputation of mister. It's administrative. It's a it's a routine in nature. I hope I answered my... Your questions. Sir, we don't see his connection in the queue yet. So we will move to our next participant, sir. We have Sai Kiran Polavarti, an individual investor. You can go ahead now. Yeah. Hi. Thanks for for taking my question.

39:28 Congratulations on good set of numbers, sir. Just two questions, sir. What helped sharp improvement in the asset quality both on the gross and net NPA, probably on the stage two assets as well. What has helped you to achieve this? Point number one. And then the second question is, like, thanks a lot again for increasing the dividend payout. How one should think about the dividend payouts going forward? Thank you. Yeah. From recovery side, to improve the asset quality, we have taken a lot of steps. We we... Right now, we have... Here is my initial, I mean, initial call, I said, we have introduced a verticalization system in our company.

40:14 Vertical is... We are having a separate vertical for collection of, I mean, word use. Even NPS also, we are segregated into soft NPA, core NPA. We have assigned with responsibility... Roles and responsibility. They they fix their target for our team. We just really impressed to improve our performance in recovery side, and we brought it on from NPA to March level from almost 425 crores in June number... June NPL level. Coming to this Yeah. Sorry. So do you see further improvement in terms of the asset quality as we move forward?

41:06 Yeah. Our target is to bring it down to below 2% by year end. See, if I look at NPA history, this is almost the present gross NPA level. This is close to about 2.4%, which is almost a sixteen year low. Post our... I mean, base are doing twenty twenty one November. Our NPL level's gone up to 8%. We have taken various initiatives like strengthening a recovery team. And side, we have taken lot of initiatives to improve the... I mean, to sell the properties.

41:51 So these are the initiatives really helping us to improve our... I mean, to bring it down our NPA. I'm confident that going forward, you can see the improvement in recoveries of NPA. Our... I mean, our guidance or internal target is to bring it down NPA level of present... NPA level from 2.4% to below 2% by year end. Even if you look at stage two numbers, even we have seen substantial improvement in stage two numbers quarter on quarter as well as year on year, which all those things indicate the...

42:38 In case we indicate that the steps taken by... The effective steps taken by the management to recover NP as well as other delinquencies accounts. Dividend payout. Yes. We have... Our board has declared interim dividend of 5 rupees per share. Final... Based on our profitability and other things, final dividend will be decided during finalization of our year end results. Sir, do you consider the... At least any percentage due date payout you have in your mind, 10%, 15%, or 20%, something like that? I am very Right now, we don't have any numbers in our mind.

43:40 Going forward, I'll be in a position to come back to you with what is the number for dividend payout ratio. Right now, really, I'm very frank. I don't have any numbers... Specific numbers. Got it. One last question from my side, sir. As the financials of the Repco Home Finance is improving, Do you foresee any benefit on the cost of funds apart from the diversification mix, which you already talked about, like, NHB and other things? Yeah. NHP, we got 600 crores. Now the NHP also liberalizes some of their schemes. I'm expecting more sanction from them. Coming to the rating side, my NPA is... Right now, it's at 2.44%...

44:28 2.4%. I'm expecting it come down to below 2% by year end. I'm positive of the rating operation my NPL level came down to below 2%, which will really help me to reduce our cost of cost of funds going. If I get a better rate, I can go for market borrowings at a better pricing. Thank you, sir. Yeah. Thanks, I answered your question. Yeah. Thanks, also. Thank you,. This is really helpful. Thank you so much. Team, we have, Harshita back in the queue.

45:17 We will allow him to ask his question again. Harshita, you can go ahead. Yes, sir. Sir, really pardon, but, me... But, actually, I... Somehow their connection got lost at the second part of the question. So I think on growth, you you answered that yes, the channel, a lot of has happened. So if you can just tell that probably is is to to the start of that timelines, these changes, etcetera, I think, which gives us more confidence going forward. Or was it from the mid of two two that it happened, so which is why that 03/02/1942 can continue at a much larger pay? And the second question, I completely missed what you would have commented, sir, on the Repco Bank reputation changes and the alignment in terms of them realizing the need for growth for realizing the potential of Home Finance business.

46:09 Yeah. Initially, mister then reputed to us for the period of three years due to administrative reasons since the Repco Bank need of services. They they called the bank. It is only administrative division. In this place, mister has posted. He's having a vast experience in the banking industry. He handled crucial portfolios in Repco Bank. He handled the large branches in Repco Bank. There is a no specific reason for withdrawing Got it. Got it. Okay. And, sir, I think the the the alignment that... Have we seen some directional change from what Repco Bank expects that has helped in the last quarter or last few... I would probably take the last six, seven months that these persons have been scaling up too gradually.

47:13 But is there is there any stance or is there any expectation change from Repco Bank from what what the way they used to operate earlier versus today? No, Ashut. There's no change in the operational. We are professionally managed company, except at board level decision making. There's no interference from the promoter. So these are purely internal strategic change which are yielding result. Okay. Okay. Please keep calm's length distance with our promoter and associates company. They will not intervene day to day operations of the company except a small credit facility with Repco Bank and deputation of mister Khan and and other things we don't have any connections with our promoters.

48:08 We used to keep arms length distance with the promoters. Got it. Got it. Sure, sir. Sure, sir. And, sir, I mean, these changes which you mentioned on the DST channel into the variation, if you can also help some timelines to it that probably from there, effectiveness of these changes have started? And just to understand that probably the... Can the the delta disbursements be much higher than even what we are guiding? Like, is it a substantial change in your opinion because you you have have been there in the organization, sir, for the last many years, and you have seen how Repco has operated in probably the best of its days to probably some of the earlier years. But if you can help us to to give some qualitative feedback on the extent of change that has... That is happening around.

49:00 On the on the... Say, Raja here, I'll take the question. On the changes timeline, it is an organic thing. Say, like, the day I want to increase my bandwidth or my channel growth is not gonna happen on one day. So it was a investment of past two and a half to three years, which we have been doing it gradually. And now the results are visible. So... And, yes, we we look at growing more and more more on the same lines, so our delta should increase. So the the stream... Yeah. Go ahead. Yeah. The b, yeah. The BSM channel has been built over over a period of almost two years now, and now we are dwelling on increasing by feet on street. So this this kind of an exercise is going to continue, and it will be organic. Cannot be sudden, so it will be organic.

49:51 Right. Liz said it's a changes or not a one time exercise. Depends on need. We will make changes. Yeah.. Yeah? Those are all the best. Deliver on our expectation. And, probably, one one constant feedback which we have always achieved, at least as an investor, we wanna put is that alignment or of Repco Bank towards the company in way that the subsidy can realize its full potential, I think. Whether that means allowing more investments in technology, reducing some of the bureaucracy and the debt. Everything should contribute towards these numbers. But all the best, sir.

50:36 Thank you. Thank you. Thanks, Archie. We'll take our next question. We have Sanjana Shivram of DAM Capital. Sanjana, you can go ahead now. Yeah. Hi, sir. Firstly, congratulations to the team on, really good quarter on disbursements and even a healthy show on, you know, asset quality. I just wanted some clarification around spreads. So this quarter, we seem to have... Our spreads seem to have expanded around 30 basis points, and, our yields have seemingly gone to around 12. So we were originally expecting that, we'd get growth by lowering some yields Spreads going forward and what would have happened this quarter with the yields?

51:36 No. That yield as for the appearance about... See, what the yield I'm getting from my assets on... I mean, hopefully basis is about 11.83, and cost of funds is about 8.35. We are maintaining a spread of 3.47. Yes. Post Repco... I mean, rate increase. A few of our bankers already increased the interest rate, which is not... So far, we have not passed on to our borrowers. Most probably this by month end, we are going to have a HALCO meeting. This HALCO meeting, we will decide. So whatever the cost increase is will be passed on to the borrower with slight time lag, number one.

52:26 Number two, improve the business, improve the disbursement to retain... To arrest a BT out. We need to pass on some great benefits to the borrowers. It will impact our spread... Overall spread. So maintaining the 3.4 spread, it's really very difficult. But, immediately, it will not come down drastically. Yeah. My spread will stable at the level of around 3.2 to 3.25 or one quarter or 0.5 down the line. Right. Right. Right. And I... Just another question. I wanted to understand.

53:12 We've been doing quite well on asset quality, And I wanted to know if the team has done any sort of assessment as to how much of our portfolio would be in drought affected areas in Maharashtra, Karnataka, or just wanted to assess what sort of risk would we be having in the improvement we're expecting going forward. Is there any sort of assessment done over there? Yeah. We have done a suspend of these incidences. See, our majority of the branches, majority of our loans are in urban peripherals of metro tier one and tier two cities. So this doubt... This thing will not affect our quality of the asset.

54:01 Given a guidance of bringing down to NPA to below 2% by morning, March end, I stick on my guidance. As of now, we have not seen any kind of stress in our loans in any part of our country. Our... Even our check return ratios is also about... It's it's almost stable. We have not seen any spike. Majority of the check it in cases, I can be able to recover by month end or first of next month. So we have not seen... Yes. We have done assessment, but we have not seen or we have not experienced any kind of dilutions or thread in the quality of the assets or thread in increase in... I mean, delinquencies levels.

54:56 Right. Right. Right. That actually is quite encouraging and very helpful. That's all for me, sir. Thank you so much. Thank you. Thank you so much. Ladies and gentlemen, we will take this as the last question. I will now hand it over back to the management for their closing remarks. Over to your team. Yeah. Thank you for all the participants who are actively participating this call. I wish you happy Diwali and festival season. We'll meet in next phone call. Thank you all. Thank you, mister Rajiv, for hosting this. Thank you, sir. Thank you. Yeah. Thank you so much. On behalf of Repco Home Finance Limited, this concludes today's conference call.

55:47 Thank you all for joining us, and you can now click on the leave icon to exit the meeting. Thank you all for your participation.