Manappuram Finance Limited

Bindu A.L

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Piran Engineer

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Piran Engineer

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Piran Engineer

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Sanket Chheda

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Sanket Chheda

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Sanket Chheda

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Bindu A.L

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Bindu A.L

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Bindu A.L

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There is only a marginal decline compared to the neighboring state.

— Sanket Chheda

So I mean how do we kind of explain the sequential decline in your gold holdings?

— Bindu A.L

Nandakumar: See, the gold holding will decline with the prices going up because see people are borrowing to meet their requirements and they have, they know the necessity and they are redeeming it in the time frame.

— Bindu A.L

So this structured book, whatever stress is there that is materialized during this quarter.

— Bindu A.L

So, madam, just a last follow-up question here, which means that I mean the stress, which was there, specifically talking about in the restructured pool of air MFI business, that's all reflecting in the 7.7% now?

— Bindu A.L

So now the follow-up question here was that I mean I think somewhere on Slide number 6, you have also talked about credit cost now expected to decline going forward from your MFI business.

— Bindu A.L

So what would be the run rate, like in terms of the 100% MFI business and going ahead assuming what you suggested last part of the stress has already slipped to stage 3 now?

— Bindu A.L

So that is the reason we feel that on whatever the stress in the portfolio, it like to Stage 3 and because of this provisioning, we were able to manage this in this quarter.

— Bindu A.L

Q

There is more competition now in the gold loan sector but we are not unduly worried because there is still a lot of untapped potential. At Manappuram we believe in long-term growth and not short-term gain. We are really optimistic about long-term prospects of the company’s microfinance subsidiary, Asirvad, which has an AUM of INR 7,013 crore showing a growth of 15.8% year-on-year. The latest guideline by RBI for MFI, especially the removal of the 10% spread cap has created a playing field and is expected to expand the market for all players including us. We have seen maximum growth in the Vehi

Management

Q

Yes. Hi. Thanks for taking my question. So, my first question is, what percentage of the book is still in teaser loan. Hello? Am I audible?

Bindu A.L

Yes Piran. It is around 10% of our book. Manappuram Finance Limited August 04, 2022 And this will mature in 2Q or what? When does this sort of run down? So it will be -- the maturity up to December '22. Okay. And how do we really think about yields going forward? Right now 21.7%. Does it go back to that 25% level or does it settle around 22% to 23%? V.P. Nandakumar: So I hope it will be settled around to 21% to 21.5%. Okay. So, July yields is what is indicative of the future. V.P. Nandakumar: Yes. Yes. This is indicative of the future, but if rates move further, the reference rates move furthe

Q

Yes. Hi, sir. So, my question was on again, yields. We are seeing that in July yields have moved to 21.7%. And we are saying that moving ahead, it should stay at 20% to 21%. Then how should we look at growth in the gold loan book? What should we aspire for this year going ahead? V.P. Nandakumar: So yes, so today the growth is flat, but we all hope that the improvement will take place. The improvement will happen when demand from the lower level really catches up. I hope this will catch up soon with the sowing season which will start just after this month. So, we hope things will improve from S

Sanket Chheda

Okay. So as of now, you are not putting any number on gold or overall AUM gold loan? V.P. Nandakumar: No, no. Gold loan, I have said around 10% growth. You have seen, we could, a figure around less than 2%. So, I have the hope that in the coming quarters, it will pick up. I am not saying the growth will be achieved, it will pick up, this is my hope, whereas in all of the segments, we will achieve a growth much more than 20%. Okay. Okay. And while sir competitions from banks, you are saying it is the same to what it was at six months back but then are we seeing any competition from unorganized

Q

Yes, hi. Good evening, sir. First question is on the Slide Number 18 when I see the 1Q auctions which were at INR1500 crore, and when I see the 4Q auctions, which are right around INR920 crore. But however, the impact on the yield in March was significantly higher as compared to June in numbers that we have reported in 1Q. What was the specific reason? You have mentioned that there is a one-time auction? What was that exactly and why the loss was relatively less in 1Q of last year? Manappuram Finance Limited August 04, 2022

Bindu A.L

So, slide 18 you're talking about the yield slide, right? Yield slide. Right. Yes, that's right. Yes. So March '22, the yield has come down due to the auction. You were aware... What was the exact figure Bindu, what was the auction amount in March, the one-time loss related to that, for the auction? For that, I will come back. It was around INR1,000 crore. Q4 was INR920 crore. No, auction for March month, you have mentioned INR618 crore, but there is no specific amount given for the losses related to that. Yes. So overall, there was an impact on the overall yield due to two reasons. One is the

Q

Okay. So we were at 19.7% gold loan yield in Q1 and our overall AUM limit is around 19.7% and 7.47% is our cost of borrowing. But Manappuram Finance Limited August 04, 2022 the increasing yield is higher than the increase in cost of borrowing. And that is the reason we expect an improvement in the spread.

Abhijit Tibrewal

So when 7.47%, this was the cost of borrowings as on, let's say in June quarter. What is the cost of borrowings as on July? So, comparable number for 21.7% yields that you have reported as in July? So this July it is not very different. It depends on the new roll over which we are doing. So, during the quarter, we expect that another only 25 basis points to 30 basis points increase in the cost of borrowing. Abhijit Tibrewal: Got it. And secondly, I mean I was seeing except for the first 20 days of April there, I mean the gold prices that actually spiked, there was not a very I mean significant

Q

Sir, if I see your home loan that has been a continuous reduction in the average ticket size related to? V.P. Nandakumar: So, the reason we focused on high yielding loans, small ticket loans to improve on the yield. So that's the reason. So now, we started focusing on saving higher ticket. But so we hope it will grow slowly. We are expecting that to take around INR10 lakhs in another quarter, incremental.

Alpesh Mehta

Okay. So what would be the average yield on the incremental business? V.P. Nandakumar: Now it is, on our incremental portfolio, we are getting a yield of around 16%. And what was it when the average ticket size was around INR10 lakhs? V.P. Nandakumar: So, earlier it was hovering around to 14% plus. So it has improved by 150 bps. On the incremental portfolio, it has gone up by 200 bps. from the three quarters in past. Because this numbers are not reflected into the yields that you report on the outstanding portfolio. The outstanding portfolio yields remained at around 14% since many quarters? V

Q

Thanks for the opportunity or said a couple of questions on the Microfinance book. One is, can you kind of help us understand the targeted trajectory on the Stage 3 assets? Where do we see that by end of this fiscal? And an extension to that, what is the guided credit cost for FY'23? Yes. So whatever restructured book fits into this quarter, and if you see the breakup, our stage 1 is almost 87% and stage 2 and stage 3 is 13%. So we believe that there will not be much addition and we are holding nearly INR462 crore provision against this Stage 2 and 3. So going forward. I think for the whole ye

Aalok Shah

So, do you want to put a number to it, madam or we expect the trajectory to move back to where we started? V.P. Nandakumar: Rajesh? In this regard, I think most of it is already crystallized. So slight increase is only expected on this. So the number should hover some around this actually. This will turn more or less the same. In that case, credit cost number will that kind of remain sticky for the coming quarters? No, the current live book, it would be, but going forward as book, I mean we close on some of it, it will come down in the by the March end. Okay. My question is on the capital posi

Q

Yes. So, sorry I lost two important questions. So what was the guidance on provision on the overall book and also on the MFI book for this year?

Bindu A.L

So this year, so the MFI book, we took almost INR120 crore in the first quarter. So in the coming quarters our expectation is much lesser credit cost. I think overall provisions half of last year is our expectation. For last year made about INR490 crore. You're saying INR250 crore of which INR130 crore we have already taken? So, last year MFI alone also INR400 crore and on other portfolios also temporary there was spiked in NPA number. So, now all other businesses settled down almost with the pre-COVID NPA level. In the case of MFI, we expect half of last year. Manappuram Finance Limited Augus

Q

Thank you.

Rajesh Namboodiripad

Thank you.