Thank you very much. We will now begin question and answer session. Your first question comes from the line of Shreya Shivani with Nomura. Please go ahead.

Shreya Shivani: Yes. Hi. Good afternoon. Thank you for the opportunity and

congratulations on a good set of numbers. I have two questions. First is on, I wanted to understand the total VNB margins, how it has played out for the quarter? If I simply put the product-wise margins, it looks like there's some probably a lesser margin that we've made on the protection book. If that's not true, then is there still some impact of GST cut on our margins, which is making the, I mean it's great margins, but it could have been even higher with the kind of growth that you've come up with. So, what is it in the margins? Is it there some product level slowdown in margins or still a drag of GST cut? That's my first question. My second question is on non-par sales. Any outlook on how we are planning to go about non-par for the rest of the year? Have we stayed away due to the price war? Or was there any, I mean we are still focused on bringing more efficiency, so we have still not scaled up. So those will be my two questions.

Hi, Shreya, this is Dhiren. On your first question of VNB margin, it's largely explained due to the product mix. But again, you'll have to consider that we don't have the GST availability in this quarter. And this is the third quarter where we've had the impact of the input tax rate non-availability. So, you have to factor that in as you look at the margins, but it's largely being explained by the product mix.

So, can you quantify how much drag we are still seeing on ? I mean it will continue for one more quarter till we have it in the base in Q3?

That's right. Yes, Shreya. It will continue for another quarter. That also will then form part of the base as we get into Q3 and Q4. On your second question.

Sorry. No quantification?

No.

Okay. Sure.

On your second question on non-par, no, we are not staying away from the market, but the environment is such that there are products on the fixed income side that at this point are little more lucrative for the customer when compared to some of our products, purely from a sticker price perspective. And again, this is the environment that the customer is living in. As time goes by and we see some sort of tempering of those alternative investments, we should start to see some pickup on the non-par side as well. Nonetheless, we look at every opportunity to be able to give value back to customers. So, we constantly look at all of our non -par products, looking at various tenures, looking at various segments, and we keep repricing as is available at that point in time. So, we are not staying away from it. The environment is such that pickup of non -par is quite subdued relative to previous periods.

Right. And the alternative products that you're talking about, is it more fixed deposits, more pension products?

Largely fixed deposits. The sticker price, yes, the sticker price of some of these products is extremely high. So that does tend to attract customers when we see this sticker price in any of the distribution shops.

Right. And just a follow-up on the overall VNB margin. This is a great start for the year. But sustainably, what is our aim? Where are we going to keep our margins for the year and for maybe the medium term?

Good question, Shreya. We don't have a margin fixation. We've gone over that before as well. Absolute VNB is what we look at growing. And in this period, we have grown VNB by 25% on the back of the growth in protection. So absolute VNB is what we will continue to focus on. Clearly, we see a lot of opportunity on the protection space. The good part is I'm not so fussed about how the retail protection growth rate numbers are. Of course, they're elevated at 50-60%. But the fact is we have now been able to get all distribution channels to sell protection in significantly larger volumes than what was being sold over a year back. So , the endeavor would be to continue to hold these levels and increase going forward so that we continue to take advantage of the opportunity that exists in the protection. Within the savings space, as we've discussed before, we'll allow the market to dictate which direction that we get the product mix to move. But we've also ensured that our cost structures are nimble enough to be able to align with the prevailing product mix. So, margin is not a fixation for us. It's growth in absolute VNB that we will continue to focus on. No change in the strategy there.

Right. And are we giving out any guidance? Last quarter, you said things were still very volatile on the macro side.

No, no guidance.

All right. Thank you so much. All the best.

Thanks, Shreya.

Your next question comes from the line of Manas Agrawal with Sanford C. Bernstein. Please go ahead.

Hi. I have two questions essentially.

Sorry to interrupt. Manas, sir, your audio is not very clear. No, sir this is not good at all.

I will come back.

Yes. Sure. Thank you. Our next question comes from the line of Swarnabha Mukherjee with 360 One Capital. Please go ahead.

Hi sir. Good afternoon and congrats on a good set of numbers. Firstly, on the margin side, Dhiren you mentioned that it is product mix. I just wanted to check that anything else to read into . And your thoughts on if this going forward, if we are seeing, say a higher growth on the traditional side on the savings side, could this normalise? If you can share your thoughts on that? And alongside that, I just wanted to check that our growth in the month of June, what led to that growth? And what product mix is leading to that growth? And does it continue in July? If you can give some color on that, that would be very useful. Second is, I just wanted to understand the growth in the partnership distribution channel. What products are driving that? And what are you doing differently now, which is leading to that growth? And same thing for your comment on the protection business. As you mentioned that you are now able to push more protection products through multiple channels. So apart from the GST-led tailwind, is there any other , what other efforts are going into driving this? Those would be my questions. Thanks.

Hi, Swarnabha. Dhiren here. Margin, I explained in the previous question as well, it's largely product mix. There is, of course, the impact of higher unavailability of input tax credit. So, looking at all of it, this is where we land up at. I didn't quite get your question on what is normali sed trajectory for traditional. Maybe if you want to clarify that, I can attempt to answer that.

Yes. So, I mean sir, this particular quarter, we have seen a softer growth print on the savings side of product. So , I just wanted to check that once that, say going forward as that picks up, then should we also expect a normali sation in all these trends?

Yes, one should. Because one of the challenges that we have seen in this current quarter and in the last quarter as well , has been around the non -participating product and which is what I explained in the previous question as well , some of the reasons why the non-par pickup has not been as strong. In quarter one last year, non- par had done exceedingly well. So, in that sense, we're working off that base. And in the current context, current environment, non-par is really not selling at this stage. So that's creating a bit of drag in terms of where the overall traditional growth is. But like I also explained in the previous question, if this , the alternative investments do tend to become a little more benign in terms of rates, then we should start to see some of the pickup on non-par. And as I also explained, we will look at every opportunity that we can to be able to position our non-par products from a longer-term perspective, look at what are the rates that we could offer and look at building that category as well. Coming to your second question in terms of growth, I think sometimes it is very difficult to read month-to-month. This is anyway a long-term business. So, our effort is to make sure that we keep growing every month, but there can be volatility in the growth as you look at it from month-to-month, but our endeavor would be to keep it as smooth as we can. In terms of July early numbers, yes, it's still too early in the month, but ye s, it continues to do well. In terms of partnership distribution, I think a lot of work has happened across the quarters, which you're starting to see the outputs at this stage. There is a fair degree of protection business also sits within it. That has also contributed to the growth that you see here. Again, the point is we've got 1,000 plus partners, and we keep continuing and diversifying this channel to become as large as we can. In fact, if we look at the long -term trend for this particular channel, it actually has delivered a near 20% CAGR over the last 5 years. So , we continue to grow as much as we can, keep working with our partners and ensuring that we've got all products and propositions that work in each of these customer segments. To your question on what are we doing on protection? We can't claim all the credit. There is of course, the tailwind of protection due to the GST. But we should claim credit for we are able to socialise this across all channels and look at embedding this as part of our sales culture. There are a variety of propositions also that we have launched in this period. Some of these are the pre -approved sum assured, which are exclusively for certain sets of customers. Again, these are identified cohorts that we are working with. There is a lot of work that we have done on the onboarding stage where we continue to deliver quarter-after-quarter improvement in terms of the frictionless onboarding that we are working through , leveraging digital income validation that's available with external agencies and in all look at making sure that the onboarding of protection is as smooth as possible without letting go of any of the guardrails. So , what you're starting to see at this point is a culmination of efforts across multiple quarters and we're quite happy to take the benefits at this stage. The work is not done. We will keep working at it going ahead as well.

Understood, sir. Very helpful. Just one quick question, if I can squeeze in terms of the persistency trends. How should we read because there looks to be market is softening year-on-year. So, if you could highlight?

No, across the quarter, you've seen that stability. It was 84.5% as we left March and it's 84.0% at this point.

Right. So best to read quarter-on-quarter, right?

Yes. You should see it sequentially as you see across the quarter.

Okay, understood. Very helpful, sir. Thank you so much and all the best for the coming quarter.

Thank you.

Moderator: Thank you. Your next question comes from Avinash Singh with Emkay

Global. Please go ahead. Avinash Singh : Yes. Hi, good afternoon. Thanks for the opportunity. A couple of questions. The first one would be more on Banca. So now Prudential is exiting a s promoter and Standard Chartered is part of their Asia exclusive deal with Prudential. So, what is the state, I mean current state, I mean of your agreement with Prudential, sorry

Is it going to be available. Is Standard Chartered India going the Indian open architecture way and you being one of the insurer there or it will go exclusively to the Prudential India entity the way I mean, they have agreement across Asia. And so far, I mean how that channel has been doing? And related to that, another, I mean there is another bank where I mean the group has now got an insurance company of its own. So , the question will be that, okay your business does it, I mean has changed your counter share or growth in that particular bank because now it also has an in -house kind of . So these are the kind of question around Banca. The second question would be more around as you have many times clarified the margin is not our fixation. But just going by how kind of the year progresses, the Q1 typically has a very, very heavy protection contribution. One this time, of course, individual protection is growing very strongly and typically the GTI credit life relative basis, Q1 is there, GTI particularly. Now as year progresses typically in H2, your retail protection will have a kind of moderation from that base because last year it has started to pick up. And then, of course, so protection typically from FY2028 might end up somewhere lower. So, in that context, I mean, you see at least for this year, the margin to hold up at these levels or because the product mix naturally going away a bit from protection, it will moderate from here on? Thanks.

I'll just take your second question first, Avinash. Again, we don't have a margin fixation. It's absolute VNB that we're looking to drive. So, if you look at it, you're right, typically protection is higher in the initial part because savings has not grown as such. Protection tends to be a little more evened out relative to savings. But we are going to continue to use every opportunity that we can to be able to grow protection. And one of the more important things is that as you look into the second half of the year, also you will see us, an uptick that will come through because of MFI business, which is part of our credit life business. That had not done so well for most of last year. So , we should start to see the benefits of that as we look at the base effect into the later part of the year as well. Again, no margin fixation. We will take the margin as it comes. Absolute VNB growth is what we're looking at. Coming to your first question on Standard Chartered. Now Standard Chartered has been a partner with us for the last 10 years, right? And in this decade, we have built a deeply integrated relationship that spans not just products, spans technology, processes and customer service. Now both these organisations, both Standard Chartered and us value this partnership very much and we are focused on delivering the best outcomes for the customers. Having said that, all distribution partners are important to us. And one of our stated objectives is that we have to be the most partnerable life insurance company. So , we continue to invest in areas such as seamless onboarding, digital capabilities, strong customer service support, product propositions and we keep doing this with each of our partners. Now that has helped us build this highly diversified base of distribu tion that you see with over 52 banks, 1,500 partnerships across the partnership distribution space. So, in that sense, we are very well diversified. The largest single channel for us is ICICI Bank. Outside of that, most channels contribute 5% and less for our business, most single distribution engines. So, in that sense, we are very, very diversified. So, in that sense we are very resilient from a distribution footprint perspective. And in terms of what Standard Chartered would do, I think they value the distribution partnership that they have with us and we continue to look at building it going forward. Avinash Singh : Okay. Thanks.

Thank you. Your next question comes from the line of Prayesh Jain with Motilal Oswal Financial Services Limited. Please go ahead.

Hi, congrats on good set of numbers. Just a few questions. Firstly, could you highlight as to what is the kind of expense trajectory that you would have built out and how is it kind of playing out? Is there an operating leverage benefit coming out in the margins today? That would be point number one. Point number two is, again, harping a bit more on protection. Second half of FY 2027 would have some , would have a high base effect on protection, at least on the retail protection side. You kind of alluded that the MFI growth will come through, but do you think that the high base effect will kind of lower down the growth or margins in the second half as the product mix kind of shifts towards probably more non-protection kind of businesses? And third would be on your, the partner growth again, right? You've seen a very strong growth. Now generally, that would come at higher cost, I would presume. So , in that sense, in spite of that, the margin seems to have kind of held up really well. And Dhiren, just trying to pull up if you're talking about a target of growth in VNB, if you could allude to that number, whether it's 22%, 24%, 25% that you're looking at for this year? That would be my questions?

Hi, Prayesh, so in terms of the expenses that we have seen for the current quarter, clearly, there is an elevation due to the unavailability of input tax credit. But we've been able to mitigate some of that through some of the cost initiatives that we have been doing across the past couple of years. So, we are seeing the benefits of all of those. I also spoke about , briefly about the outcome that you've seen in terms of the AI/ML. So, a lot of work that we have done on the tech space, digital space, analytical space, all of that is helping us improve the cost efficiency that we have and we continue to feed that back into our margins. To your second question on what does the protection mix look like in the second half of the year. You're right, protection does come across a fairly steep base as we come into the second half of the year and that base effect goes away. So, if the question is will I expect to see a 60% plus growth in the second half of the year, very unlikely. This of course is elevated because we're carrying through the levels that we have built up over quarter three and quarter four. Our endeavor would be to keep these levels of protection where they are and continue to build on growth on that. So, of course the growth of that is expected to taper down. But again, I keep looking at the opportunity. This is an area that we continuously focus on. Protection is a core focus area for us. Clearly this is a multi-decadal opportunity. And the endeavor on our part is to make sure every part of our distribution is getting more and more immersed about selling protection and to be able to drive the momentum of this forward. To your other question on partnership distribution, I think your going -in assumption is that partnership distribution is a low-margin business. I would beg to differ there. It just depends upon what products you sell because you have to tailor -make the product for the customers that you have access to. If you sell the wrong product to the wrong customer set, then you end up with poorer outcome, especially when you look at persistency. But when you have got that tailor -made, then you end up getting decent outcomes.

And Dhiren, just anything on VNB growth that 20%, 25% is a good assumption for this year?

No guidance on that, Prayesh.

Great. Thank you and all the best.

Thank you. Your next question comes from the line of Sanketh Godha with Avendus Spark. Please go ahead.

Yes. Thank you for the opportunity. So Dhiren , just one small clarification. Tomorrow, Prudential becomes fully promoter of Bharti AXA. You are confident that Standard Chartered will still remain an open architecture and you will continue to do business with Standard Chartered or it will be a full migration of Standard Chartered to a new company? Any color or any discussions you have with the bank on these lines?

So Sanketh, this is a question that's best answered by Standard Chartered, but let me give you our perspective on this. As I had mentioned in answer to a previous question, this is a partnership that we have developed over the last 10 years. And again, the deep integration across technology, products, processes, customer service is not something that is trivial. It does take a lot of effort across both teams to be able to sit down at the table together and build solutions that benefit both parties while keeping customer at the center of everything that you do. And that is something that Standard Chartered and us are extremely focused on. So, both of us value the partnership, and we are clear that we will deliver the best outcomes for customers while ensuring that it delivers value for both the partners as well. I think that gives you a sense of what we think about Standard Chartered and what Standard Chartered also thinks about us.

Understood. Understood. And sorry, and my second question is on the protection business because last time when the GST thing happened, you guys or industry in general has not changed the prices of the protection business despite input credit not availability a drag. Have you guys or in general industry has moved to a direction to reprice the product to the extent of negating the impact? And if you intend to do it in a couple of quarters when as you highlighted that growth might slow down on a bigger base in second half, that can be seen as an additional lever for the margin to you and to the industry in the second half?

Let me give you our perspective on this. When the GST change had happened, we saw this as a customer trust-enhancing move, and we had repeatedly told on the call as well that we have to take advantage of the opportunity. Whatever we have to do, we will do that over a longer period of time. If you were expecting en-masse price changes, that has not happened, and we don't expect that at all. There will be certain segments that we will do repricing at, and these will be specific segments where we think they're not getting enough value and there is sufficient cushion that's on the table that we could reprice our products at. So anyway, this is a continuous exercise. We continuously look at what are these cohorts that we need to reprice. And we treat this as business as usual. Now very clearly, I don't expect the industry also to have any en-masse price changes even as we get into the second half of the year.

Understood. Understood. And lastly, on some data keeping questions. The annuity growth, what you saw, 33 % in the quarter year -on-year is largely single premium led? And second, if you can give a broader mix of non -linked savings broken down into par and non-par. You alluded that it is more par heavy, but if you can give a broader color where it is standing, that will be useful?

So, annuity in this quarter is led by regular premium as compared to what you had seen in the previous quarter. In terms of par, non-par, we are about 2:1 on the par to non-par ratio at this point.

So, when you say regular premium, naturally, we did not sell that product, which is zero surrender charges product, right? We went back to the same regular-premium deferred annuity plan?

Yes, this is a regular deferred annuity plan.

Okay, perfect. That's it for my side. Thank you.

Moderator: Thank you. The next question comes from Vinod Rajamani with Nirmal

Bang. Please go ahead.

Thank you. I have 2 questions. One is on annuity and also protection. They've both done well. Have you tapped into newer channels and so on? So just some color on what additional, say, distribution capabilities you have employed during this quarter? That's the question one. Second is, so I track NBFCs as well. So, post January of next year, I suppose the regulator is allowing NBFCs to distribute say insurance products , and they just have to take approval from IRDAI as in RBI approval is not required. So, any color you can provide on what impact that will have, say on credit life and so on post say January 1st, that could be helpful?

Vinod, on your last question of NBFCs allowed to sell insurance, no, I don't have any view on that yet.

So, it says NBFCs can distribute insurance products without seeking RBI approval? Dhiren Salian : But that could just be to distribute.

Yes.

But if they have to distribute any insurance product, then they would need to be registered with IRDAI as well.

No, that is right. But the whole approval process will get speeded up in my sense. So anyway, that's a…

It’s difficult for me to comment from RBI side. But if they have to distribute insurance, then they would have to do this approval with IRDAI.

Yes, yes. No, that will stand, but it might get a little speeded up is my sense. But yes, I mean, it's slightly hypothetical at this stage. But yes, I just wanted any color on this , on what additional channels you are selling annuity and protection from besides?

Actually, it's across all channels. The levels that we've seen on protection has actually increased across all channels, some more than others. So , it is actually secular in terms of growth. In terms of annuity, I think when you look at it, this is another opportunity area that we are continuously focused on. And clearly, we've been doing double-digit CAGRs for a long time now. So this is , and frankly, we're getting this opportunity, so we should be able to partake in this space, and we keep building on that.

Right. Yes. Thank you so much.

The next question comes from the line of Samant Singh with Phillip Capital. Please go ahead.

Yes. Hi. Thanks for taking my questions and congrats on good set of results. Just two, three questions. First is on again, coming back on partnership distribution. So , it is like 14.6% of the total mix, and it is normally like commission - intensive business channel. So how we are sort of balancing this growth versus Expense of Management (EOM) headroom? So, is there any internal feeling on partnership mix? So that is the first one. Second is on the total cost to premium ratio, which expended by 60 bps to 21.8%. Can you please split into GST input ITC disallowance and maybe discretionary sales rate spent. So, what is the annualised drag in rupees from the ITC disallowance? So that is the second question. And third, maybe if you can just sort of provide what is the fund level EOM utilisation for FY2026, so split between participating and non-participating including linked. So, idea is that what is the buffer to the 100% regulatory limit on each fund? So these are the 3 questions.

So, in terms of our expense of management, we are well within the cap. We've not disclosed that number, but we are very well within the cap. In terms of cost to premium, I think the schedules will carry the details subsequently. You should be able to look at what is the GST component that sits within Schedule III and you should be able to derive if you want, what the full year's impact could be in terms of GST. Coming to PD, and this is something that I mentioned earlier. What you're expending as commission effectively has to take into account a base commission and whatever else that you need to provide as overrides, which ensure that there is quality in the business. I think most people forget that if you are getting good quality business, then there is a cost to pay for that. We are clear that we focus on those partnerships, which gives us value, value in terms of business growth as well as quality. We look at the ove rall cost that we can expend, which includes commission as well as our own opex, and that tends to be broadly stable across channels. So that means you look at commission, you look at overheads, you look at opex, all of it put together tends to be broadly similar across channels. And that's how we look at architecting that business. So when you look at the total cost, yes just to close that point, when you look at the total cost of business, you will also consider any training costs, any supervisory costs, any support costs that you have, you have to consider all of it when you look at the cost that gets expended at a channel level.

Sure. So, we can fairly assume that there's no sort of internal ceiling, 15% is quite significant. But we can sort of assume that this can continue to grow as and when the sort of opportunity.

Yes. Samant the good part is that it's 15%, which is brought about by some thousands of partners. So , it's not one partner that you have to worry about a concentration mix.

Okay well taken. And if I can follow up with two small questions, if that's okay. So on Slide 23, there's like there's an addition of 15,000 advisors recruited in the first quarter. So, this is quite strong number in terms of the front loading. So what is the full year target recruitment, any cost implication for FY27 opex? So, any color on that would be helpful.

I don't think it's front-loaded to that extent. Last year, we added about 70,000 agents.

Okay. Okay. So this is like this year also, it will be fairly that range only. So compared?

Yes. Correct.

Okay. And just on the group funds because it seems to be on a high growth trajectory since last couple of quarters. So, is it like growth is opportunistic or is it a structural sort of thing? How should we think about it going forward as well?

Group funds is lumpy, but our perspective on group funds is that if it is value accretive, VNB accretive, we will take it. Again, I come back to the point, again, we are not margin focused. We are, our focus is to ensure growth in value of new business. So as long as it is positive VNB, we will take it. But group funds tends to be lumpier business. It's the most lumpy business of all the segments that we have.

Okay. Thanks and all the best.

Thank you.

Thank you. The next question comes from the line of Nischint Chawathe with Kotak. Please go ahead.

Thanks for taking my questions. The first one was on agency where I know we were making investments in this, but agency growth is 2% for the quarter. I guess we have all the base, etc ., now favourable. So how should one think about this?

So, Nischint, that 2% is a much better number than we had across the previous quarters. So very clearly, you can see the trajectory is now turning positive. And again, we continue to work with the channel to be able to deliver on growth. We've spoken about some of our initiatives earlier. These cent er around our micro market approach. This is, again, complemented by use of our technology, analytics, all of it to be able to drive productivity. But just to, from a number perspective, it is positive from when it was negative in the previous quarters.

I know. But it's probably only there in the base now, right? So, in that sense, we would expect , I mean, how would you , I mean, let's without putting a number, I mean, how do you kind of budget it for the year? Do you expect it to be in line with nominal company growth? Or would you think that it probably takes a couple of more quarters to kind of get there?

We would want agency to move towards average company growth faster, sooner rather than later. But in addition to that, I think one, what you'll also see is that we're starting to see a shift in the product mix. So, from a VNB perspective, it is a lot more accretive than the 2% growth that it shows on the APE side.

Okay. And the product mix at the company level and agency level would be similar?

On the agency side, you will see some higher pickup in terms of improved higher sum assured, starting to see improvement in the share of protection within agency as well. So which is why I mentioned that the VNB growth is better than what you're seeing as the 2% APE growth.

Okay. And retail protection growth at the company level, obviously is massive. But has ICICI Bank also, I believe retail protection has been one of the focus areas out there, grown retail protection at similar levels?

Yes, all channels have grown largely at the similar rate.

ICICI Bank growth could have been slightly faster, right? I mean, if I just kind of do a math?

It depends on the underlying product mix, right?

Okay. Got it. Thank you very much.

Thank you. The next question comes from the line of Madhukar Ladha with JP Morgan. Please go ahead. Madhukar Ladha : Hi. Thank you for taking my question. First, Dhiren on partnership distribution, that channel has been the best -performing channel for us for some time now. I wanted to ask if there are any particular partners that have been contributing to such a strong g rowth? Is it more digital -led and digital online aggregators that are leading to this growth? Or you know how would you characteri se it? Is it more sort of broad-based? And how sustainable do you expect this to be? Second, on group protection, can you give a breakup of credit life and GTI? And third, our, still like our AUM continues to see an outflow because benefits paid , commissions, etc., are still not, are still quite high. So , what is the read on that? When do we start seeing organic cash accretions? Yes.

So, coming to your question on PD, I think when you look at the longer term, we're looking at nearly 20% CAGR over the last five years. So, it does look elevated in this particular quarter. But if you look at the longer period also, it is not a small number to go by. Madhukar Ladha : Correct, I agree.

What's driving the growth? See, frankly, what I mentioned earlier, my largest channel is ICICI Bank, and that's roughly 15%. No other single distributor is hitting the 5% number. So, when you look at this 15% , that is PD, you have a multitude of partners within it. And again, the whole point of it being diversified, take advantage that we can. We work with all of our distribution partners. Again, I spoke about the fact that we wish to be the most partnerable life insurance company, and we continue to build distribution networks and proposition in each of our distribution partners. There is of course this channel also has taken advantage of the protection boost that you see. To that extent, the web aggregator space does get classified under partnership distribution. That does contribute to some of the growth there. But again, coming back to the point, not one partner is more than 5%. To your question on split of group, we do that on an annual basis. You have that for the year as part of our full year pack, you can refer to that, there'll be some minor changes across when you look at read-through for the current quarter. In terms of AUM, I think one of the... Madhukar Ladha : Will it be similar to the full year’s number?

Yes, it will be broadly similar to the full year's number. Madhukar Ladha : Okay. Got it.

In terms of assets under management , roughly are about ₹ 3.3 trillion. We also have to consider that 5, 7 years back, we used to do a significant amount of Unit Linked. Unit Linked business has a lock-in that goes away at the end of 5 years with zero surrender charge. So, we do see a spike in exits whenever thes e policies come to the 5- 6-year window. As they go beyond, then obviously, the surrender rates drop off, but you do see a spike when it gets into the 6th year window. So that is one of the points that we keep working with our customers to say that you have to stay longer. The longer you stay it becomes that much better for the returns. And we have to obviously look at what , how does this product perform over a 10 -year perspective, 15-year perspective. The other bit also is that in addition to Unit Linked, we do have significant maturities that have come up. And these typically are the ones where the policies have hit their 10-year, 15-year mark. And in such an instance, it is a scheduled maturity. There was a significant amount that had gone through last year, and we see some coming through this year as well. And that is what comes through on the AUM side. But if you look at from a VNB perspective, this does not impact the VNB because you've already factored that as part of your expectation of persistency across the years. Madhukar Ladha : Just one follow -up question. The persistency numbers, so are you seeing a dip in the 13 th month, 25 th month, 61st month. Is this any product related? Or second, and the second part of the question is also that would this mean that are these factored in? Or is it above our expectations and could cause again a dent in our EV?

So, 13th month is broadly steady. You're looking at 84.5% and 84 .0%. What you see on the 25 th month is the drop that you saw last year that is just carrying through. So, it is just an expression that you see from policy that had surrendered in the past period, which is why you see this number that has dipped across 25 th month from 81% to 77%. We anyway had done an assumption setting at the end of , towards the end of the last year, which is towards March. We're not seeing anything material from then on. Madhukar Ladha : Got it. Okay. Thanks, and all the best.

Thanks.

Thank you. The next question comes from the line of Dipanjan Ghosh with Citibank. Please go ahead.

Hi. Hope I'm audible. So, a few questions from my side. So, at the start of the discussion, you mentioned about the various margin levels that you're using in terms of higher sum assured, longer duration policies, riders, etc. etc...

Really sorry to interrupt, Dipanjan sir, again your voice is modulating.

Okay. Maybe I'll rejoin in the queue.

Sure. Thank you. Your next question comes from the line of Mohit Mangal with Centrum. Please go ahead.

Yes. Thanks for the opportunity and congratulations on a good set of numbers. My first question is that have we done any changes to pricing of retail protection products over the last say 4 to 6 months? And also, I wanted to know which age group of customers are kind of subscribing to our protection policy?

Mohit, the target market for protection typically centers around the 35- year-old. And again, one can understand this because typically, this is the age from a median perspective where people tend to take on greater responsibility. So, this product tends to be centered around that point. This has not really fluctuated. 34, 35 typically has been the age where, which has been the median age for quite a while right now. And people typically take it for another 30 -35 years in the sense that they cover their working life to that extent. So , you're looking at a 35 -year-old, broadly buying it for another 35 years, which covers the 65, 70 age bracket. In terms of pricing, I covered this earlier as well. There is no en-masse price change. It's business as usual. There are segments that we would like to reprice based on emerging experience that we see, and it's a continuous process. And these are small changes that happen at all points in time. There is clearly no en-masse price change that we have done over the last 9 months nor are we expecting at this point.

Okay. Lastly, any new product launches that we can expect over the next 3 to 6 months?

Yes. There is always some new product that we will keep working at, but it will be a little premature for me to announce on call. We will, of course, have our scheduled launches with our distribution partners as well as distribution colleagues when it gets closer to actual launches.

Thanks, and wish you all the best.

Thank you.

Thank you. The next question comes from the line of Megha Pagaria with BNP Paribas. Please go ahead.

Thank you so much for taking my question. I wanted to understand what is causing the decline in the non-linked APE business. It has fallen by 9.5%. So, is it primarily just due to an inflated base or what was the reason?

Megha, I covered this question earlier. This is largely the non- participating business, which has not done so well given the current environment, where you're seeing alternate investments such as fixed deposits have extremely high sticker prices.

Thank you.

Thank you. The next question comes from the line of Neeraj Toshniwal with UBS. Please go ahead.

Yes. Hi, Dhiren. Congrats on good set. So, I wanted to check first on non-par savings, I think you already mentioned that demand has been, the sticker price has been there. But going forward, how do we see this? Because yields have been supportive and we would have expected that in this environment, this product should actually do better. So how should one think about modeling for coming quarters? That is one. Second question is on persistency. I think you already mentioned that is quite stable, but still a little bit of collection stress. Is that being there because of external environment or there is some behavioral change post the surrender norms that led to higher payouts from year one. So just wanted to get some sense here? So these are my two questions.

Yes. So on persistency, Neeraj, again, you mentioned right, it's broadly stable. Whatever we factored as part of our assumptions is that at the end of last year, there's nothing material from then. Collections are not dropping. In fact, for this quarter, we have collections which have grown at roughly 9%. So, it's not a feeble number to that. So, I think we continue on that path there. On the non-par, one has to look at, if you were to look at modeling, it also has to take into account what the environment offers. Clearly, you're right, from a pricing perspective, our non -par products are priced quite attractively. We continue to find areas in which we can offer more to customers without losing too much at our end, which means we're looking at reflecting the yield c urve as much as we can for customer prices. But again, like I mentioned earlier, this is also have to take into account what the environment offers in terms of alternate investments such as FDs. So, if that starts to drop, then you know that these products can pick up and do well over the medium term.

But generally, we have seen elasticity for FDs have been like a couple of months only and then the trend changes, whenever that has happened in the past also. Do we think that similar trend will follow this time as well or are we reading something different?

So, our endeavor would be to ensure that customers understand the proposition that they are buying. Clearly, FDs are not long-term instruments, but one can understand why customers may get lured and distracted by the high ticker prices. What we continue to do to ensure that customers understand that our products are longer tenure products, 10 years, 15 years, 20 years, and the value that they see of those products, especially when you're able to lock in prices at these attractive rates, we try to make sure that they understand that proposition as best as we can.

Why I'm asking is because the LDR from banks is relatively very high right now. And given the loan growth is much faster than the deposits , there has been pressure from the bank side to focus more on deposit and lower sales on the insurance? So I was coming from that side. Generally , that tempers down within a few months. So, and with FCNR deposits, more flows coming into, do we think that this will probably lead to a better sales in non-par savings going forward? So it was more specific question to the current LDR proposition where we see.

It's possible, Neeraj. Your observation is spot on, it's possible.

Okay, thank you so much. And all the best.

Your next question comes from the line of Dipanjan Ghosh with Citibank. Please go ahead.

Sir, at the start of the discussion, you mentioned about the various margin levers that you're utilising in terms of higher riders, sum assured , longer tenure policies, etc. etc. Now just in terms of the rider attachment, could you give some color on the current attachment rates or in terms of how that has been shifting over the last few quarters? Some color on that and also the sum assured on ULIPs, how that has been tracking. Second, on the credit protect part, you mentioned that MFI has been recovering and momentum is sustaining in non-MFI. But in terms of directions, in terms of mix between the two, I mean, let's say, three, four quarters back when MFI was struggling versus now, has the mix like normalised to historic levels? Or is there some more headroom for the MFI segment to kind of ramp up? And lastly, I think, going back to your business mix change, both in the partnership channel and in the Banca channels. I just wanted to get some color, and maybe kind of alluded to some part of this that you have kind of devised specific strategies for selected customer cohorts, especially in the partnership channel. I mean, I just wanted to get some deeper understanding or the nuances of how you're going about this strategy.

Yes, so Dipanjan, both rider attachment and high sum assured ULIP both are on the uptick, and they've been doing well continuously across the past few quarters. I don't want to peg a number to it, but you're seeing improvement quarter after quarter. On your question of where are we o n the MFI mix, I think this quarter, we are fairly normalised. So, we would expect that both MFI and non -MFI continue the growth into the coming quarters as well. Yes, I trust we answered your questions, Dipanjan.

Yes. So just the last question in terms of the customer cohort -based strategies that you are utilising in the partnership channel or the Banca channel, which is driving this favourable business mix change. I mean, what are those exactly? I mean, can you give some color on that?

So, we've got a wide diversified product mix. Now the whole point is that we've got different products that can actually fit specific product segments. So if for instance, at a very gross level, protection works very well in a set of customers which are younger. Annuity works well typically in a 55 -year-old plus customer pool. You find savings of various natures, both unit -linked as well as traditional that wo rk across different customers, broadly at a median of about 45 , but again, at differential income levels. Now within the partnership space, we work with our partners to identify what are the dominant customer segments that they've got access to. And then we ensure that we are fitting our products within that distribution network in an appropriate fashion, that's what I meant. We keep working on that continuously. We keep ensuring that our distribution teams are well aware of what are these segments of , and segments and propositions that fit well together, and we keep pushing that.

Got it. Thank you, Dhiren and team. All the best.

Thank you.

Your next question comes from the line of Yash Jain with CNBC. Please go ahead.

Am I audible clearly to everyone?

Yes Yash.

Okay. First of all, congratulations on a great set of numbers. My question was largely with respect to the change of promoter status to investor for Prudential. Of course, they hold about 22% stake in the company. My question was with their request, as you had mentioned, to the regulator as well for the declassification of promoter and relinquishing their Board seat and the nominee Director, do they hold on to that stake that they have because under IRDA regulations again, 24.99% stake is what's permitted if an entity turns from a promoter to investor, for which the conditions, of course, are relinquishing your Board seat, and nominee director being out of the Board. So then in that case, is that provision available fo r them? Second, they are seeking that provision and continue to hold on to their stake?

So Yash, you're right. As per IRDAI regulations, you can't be a promoter in two different life insurance companies. And the requirement to be forcibly to be classified as a promoter is above 24.99%. So below which you can be an investor and continue to be invested in the company. What Prudential has done is they've asked for a reclassification from promoter to investor since they hold a little under 22%. And that is the reclassification request that's been approved by our Board, and we have submitted that onward to IRDA I, and we await IRDA I's inputs on that. There is , from our perspective, the way we read our regulation is exactly the way you read it. There is no requirement for them to sell down at this stage.

And do you think, I mean, your reading or your communication with them, is the whole exercise of declassification of promoter being done so that they can hold on to the stake, and I mean, maybe dilute whenever in the future that they require, and not have any mandatory requirement to dilute that stake?

It would be difficult for us to answer that question, Yash. It's best addressed by Prudential.

Okay. Thank you so much.

As there are no further questions from the participants, I now hand the conference over to the management for closing comments.

Thank you very much. Safe harbour: Please note that this transcript has been lightly edited for the purpose of clarity. Except for the historical information contained herein, statements in this release which contain words or phrases such as 'will', 'would', ‘indicating’, ‘expected to’ etc., and similar expressions or variations of such expressions may constitute 'forward-looking statements'. These forward-looking statements involve a number of risks, uncertainties and other factors that could cause actual results to differ materially from those suggested by the forward-looking statements. These risks and uncertainties include, but are not limited to our ability to successfully implement our strategy, our growth and expansion in business, the impact of any acquisitions, technological implementation and changes, the actual growth in demand for insurance products and services, investment income, cash flow projections, our exposure to market risks, policies and actions of regulatory authorities; impact of competition; experience with regard to mortality and morbidity trends, lapse rates and policy renewal rates; the impact of changes in capital, solvency or accounting standards, tax and other legislations and regulations in the jurisdictions as well as other risks detailed in the reports filed by ICICI Bank Limited, our holding company, with the United States Securities and Exchange Commission. The Company undertakes no obligation to update forward-looking statements to reflect events or circumstances after the date thereof.