Questions across 4 calls

Sachinder Bhinder

Firm not listed in source transcripts

Aavas Financiers Limited

Aavas Financiers Limited CC-Sep24.pdf · 2024-11-07

Thanks Renish, from the perspective of this, as you are rightly articulated on the cost of funds thing there is an increase. I think if you look at the last two years, our disbursement yields had been lower compared to the AuM yield. So, to cover up that we are trying to push the disbursement yield, but it is taking effect with a lag. However, our endeavour compared from H1FY24 to H1FY25, we have increased the disbursement yield by 25 bps. But since I have an AuM lag of the last couple of years where the disbursement yield was lower than my AuM yield, it is taking time to really cover up. However, as I said, our endeavours continue to increase the disbursement yield. In that our focus on the lower ticket size where we have risk adjusted returns and self-construction individual houses. So that's what we have guided our endeavour with that wi ll continue to be in the range of around 4.8 to 5% as we speak.

Yeah, FY25 and as we see the rates are picking up once the cost of funds started coming down, we see the trajectory moving up. So, there's a conscious effort as I've been re -iterating on every call that efforts to increase the disbursement yields on a Q-o-Q basis and we've seen the green shoots. It is taking time for us to really cover up, but our endeavour is to see the pickup over quarters.

Aavas Financiers Limited CC-Mar24.pdf · 2024-04-25

Thanks, Renish. I think, Renish, you would have observed that as we stated earlier in our guidance and every quarter-on-quarter there has been an improvement which is there. So, I think in line of whatever we started across our journey, we are confident about our strong H1 with the kind of green shoots which we have seen in the number of logins, the kind of tech transformation which has happened. So, as a management team, we are guided by the fact that the sequential improvement which we have seen quarter-on-quarter, I believe and we have trust in our teams and the kind of logins under sanctions which we see in the coming times, we will stay at the top for a strong and robust H1.

In that I will throw light on the OPEX-light models which we have been discussing. I think if you look at the mix of digital, the eMitra, the Mitra and those channels, we were conventionally at around 10%. As we speak and we close the year, we are around 13%. And these are typically the OPEX-light kind of models which are there. And the rest of that I’d say is a hybrid of the direct channel and some part of the connector channel which is there. So, that’s the broad break up.

Aavas Financiers Limited CC-Dec23.pdf · 2024-02-02

So Abhijit I will answer the question in two parts. You have two basic questions. I think as we have guided earlier we continue on the AUM growth of 2 0% to 25%. I think on the disbursements what you are referring we have seen a sequential month-on-month growth and that gives confidence to us as management team in the coming quarters to come back to the growth on the lines what is expected . Secondly I think on the tech transformation you will really appreciate that it is overall of the entire tech transformation right from an LOS, LMS and ERP. The Phase I of LOS and the Phase II of LOS which is the loan origination system has gone live, the second system which is the loan management system is under implementation and it will take another three to four months for us to get it live. I think once all of the three systems are live together in the coming three to four months we ’ll see a real tech initiative tran sformation benefits really flowing in actually. It will help us in two counts end-to-end as this period of time when we speak our ability to have 30% lead generation from the digital channels and 10 % disbursements coming from those channels will get augmented and we will move towards more defined business sourcing channels like the Mitra and eMitra. The recent tie-up which we have done is the eMitra tie-up in Rajasthan which has opex light kind of a model where the sourcing is really defined in the peripher ies and deep down of Rajasthan and the couple of them which we are in actually talk s, so this will help us in sou rcing, in defining and transforming the technology what we have implemented to really see the benefits but in the initial phase as we talk I th ink on a system which has got implemented having seen 1 lakh plus of applications going through and Rs.4500 Crores of sanction go through gives us a confidence that the stabilization on the LOS is there and we see green shoots on those lines actually and w e see that reflected in numbers on month-on-month improvement on the disbursement side.

So as we speak, compared to the last January we are in excess of 20 % to 25% of the previous year and that gives us confidence and it is improvement to December so to say. Abhijit you need to appreciate the two parts. It is a foundation of the tech which has been implemented as a whole and across and thi s has started showing green shoots . It is a foundation which has been set up and what I would really appreciate the management team, the tech transformation team and with our partners that this has been a very laminar rather than being anything which would create road bumps or anything which disrupts actually in such a major tech transformation. Secondly it is the behavioral adoption across 350 branches , 13 states, across the length and breadth and the direct sourcing mo del which we do, so I think that is a big amount of behavioral adoption which is there and the green shoots of that in improvement, as I talk about reducing the turnaround times from 13 days to 9 days are there in that. As a result of which you will see those kind of initia tives which will re ally have a monetization happening . One of the key factors which we said that you have to really appreciate with this kind from a 3.79 % opex ratio to a 3.49 % a sequential reduction with that is also one of the testimonies of the fact actually , so there are green shoots and a good sound tech foundation with processed people are showing signs actually.

Aavas Financiers Limited CC-Sep23.pdf · 2023-10-27

Mayank, this is Sachinder. This is partly because of the rate reduction on holding on to our existing customer and part is on the new placement, both put together has resulted in the drop in the yield.

So as we have been saying that we were able to maintain the spreads at 5% and above. So it is currently around 5.29%, our endeav or is there. But what we are trying to do is that the good customers are there. We don't want to let them go. So partly because of rate reduction on that side and some part and some bit on the pricing pressure on the new acquisition, so to say , it's a mix of both. So from a guided perspective, I think we will try to maintain in the range of 5 % as far as concerned despite and in spite of the cost of borrowings going up, actually. That would be our endeavor, and that's our aim, actually.