Icici Bank Ltd Q1 FY2025 Earnings Call

Ladies and gentlemen, good day, and welcome to ICICI Bank's Q1 FY '25 Earnings Conference Call. Please note that this conference is being recorded. I now hand the conference over to Mr. Sandeep Bakhshi, Managing Director and CEO of ICICI Bank. Thank you, and over to you, sir.

Thank you. Good evening to all of you, and welcome to the ICICI Bank earnings call to discuss the results for Q1 of financial year 2025. Joining us today on this call are Sandeep Batra, Rakesh, Ajay, Anindya, and Abhinek. The Indian economy continues to remain resilient as reflected by high-frequency indicators, showing growth momentum such as expansion in manufacturing and services PMI, higher tax collections, real estate buoyancy, and a pickup in rural demand, supported by the consistent actions and initiatives of the policymakers. At ICICI Bank, our strategic focus continues to be on growing profit before tax, excluding treasury, through a 360-degree customer-centric approach and by serving opportunities across ecosystems and micro markets. We continue to operate within our strategic framework to strengthen our franchise, maintaining high standards of governance, deepening coverage, and enhancing delivery capabilities are focus areas for our risk-calibrated profitable growth. The profit before tax, excluding treasury, grew by 11.8% year-on-year to INR 140.80 billion in this quarter. The core operating profit increased by 11% year-on-year to INR 154.12 billion in this quarter. The profit after tax grew by 14.6% year-on-year to INR 110.59 billion in this quarter. Total deposits grew by 15.1% year-on-year and 0.9% sequentially at June 30, 2024. Term deposits increased by 19.9% year-on-year and 3.1% sequentially at June 30, 2024. During the quarter, average deposits grew by 17.8% year-on-year and 3.3% sequentially, and average current and savings account deposits grew by 9.7% year-on-year and 5.1% sequentially. The bank's average liquidity coverage ratio for the quarter was about 123%. The domestic loan portfolio grew by 15.9% year-on-year and 3.3% sequentially at June 30, 2024. The retail loan portfolio grew by 17.1% year-on-year and 2.4% sequentially. Including nonfund-based outstanding, the retail portfolio was 46.3% of the total portfolio. The business banking portfolio grew by 35.6% year-on-year and 8.9% sequentially. The SME portfolio grew by 23.5% year-on-year and 4% sequentially. The rural portfolio grew by 16.9% year-on-year and 3.4% sequentially. The domestic corporate portfolio grew by 10.3% year-on-year and 3.1% sequentially. The overall loan portfolio, including the international branches portfolio, grew by 15.7% year-on-year and 3.3% sequentially at June 30, 2024. The net NPA ratio was 0.43% at June 30, 2024, compared to 0.42% at March 31, 2024, and 0.48% at June 30, 2023. During the quarter, there were net additions of INR 26.24 billion to gross NPAs excluding write-offs and sales, reflecting mainly the seasonal higher additions in the Kisan credit card portfolio and lower recoveries and upgrades compared to the previous quarter. The total provisions during the quarter were INR 13.32 billion or 8.6% of core operating profit and 0.43% of average advances. The provisioning coverage ratio on NPAs was 79.7% at June 30, 2024. In addition, the bank continues to hold contingency provisions of INR 131 billion or about 1.1% of total loans at June 30, 2024. The capitalization of the bank continued to be strong with a CET1 ratio of 15.92% and total capital adequacy ratio of 16.63% at June 30, 2024, including profits for Q1 of 2025. Looking ahead, we see many opportunities to drive risk-calibrated profitable growth. We believe our focus on Customer 360, extensive franchise, and collaboration within the organization, backed by our focus on enhancing delivery systems and simplifying processes, will enable us to deliver holistic solutions to customers in a seamless manner and grow market share across key segments. We will continue to make investments in technology, people, distribution, and building our brand. We are laying strong emphasis on strengthening our operational resilience for seamless delivery of services to customers. We remain focused on maintaining a strong balance sheet with prudent provisioning and healthy levels of capital. The principles of return of capital, "Fair to Customer, Fair to Bank" and 'One Bank, One Team', will continue to guide our operations. We remain focused on delivering consistent and predictable returns to our shareholders. I'll now hand the call over to Anindya.

Thank you, Sandeep. I will talk about loan growth, credit quality, P&L details, growth in digital offerings, portfolio trends, and performance of subsidiaries. Sandeep covered the loan growth across various segments. Coming to the growth across retail products, the mortgage portfolio grew by 14.2% year-on-year and 2.5% sequentially. Auto loans grew by 14.8% year-on-year and 1.7% sequentially. The commercial vehicles and equipment portfolio grew by 13.9% year-on-year and 2.2% sequentially. Personal loans grew by 24.9% year-on-year and 1.5% sequentially. The credit card portfolio grew by 31.3% year-on-year and 4.2% sequentially. The personal loan and credit card portfolio were 9.7% and 4.4% of the overall loan book, respectively, at June 30, 2024. The overseas loan portfolio in U.S. dollar terms grew by 5.4% year-on-year at June 30, 2024. The overseas loan portfolio was about 2.8% of the overall loan book at June 30, 2024. The non-India-linked corporate portfolio declined by 9% or about USD 24.8 million on a year-on-year basis. Of the overseas corporate portfolio, about 92% comprises Indian corporates, 6% overseas corporates with Indian linkage, 1% comprises companies owned by NRIs or PIOs, and the balance 1% non-India corporate. Moving on to credit quality, the gross NPA additions were INR 59.16 billion in the current quarter compared to INR 51.39 billion in the previous quarter. There were gross NPA additions of about INR 7.21 billion from the Kisan credit card portfolio in the current quarter. We typically see higher NPA additions from the Kisan credit card portfolio in the first and third quarter of a fiscal year. Recoveries and upgrades from gross NPAs, excluding write-offs and sales, were INR 32.92 billion in the current quarter compared to INR 39.18 billion in the previous quarter. The net additions to gross NPAs were thus INR 26.24 billion in the current quarter compared to INR 12.21 billion in the previous quarter. The gross NPA additions from the retail, rural and business banking portfolio were INR 57.32 billion in the current quarter compared to INR 49.28 billion in the previous quarter. The additions for the quarter include the KCC NPAs mentioned earlier. Recoveries and upgrades from the retail, rural and business banking portfolio were INR 29.33 billion compared to INR 32.17 billion in the previous quarter. The net additions to gross NPAs in the retail, rural and business banking portfolios were INR 27.99 billion compared to INR 17.11 billion in the previous quarter. The gross NPA additions from the corporate and SME portfolio were INR 1.84 billion compared to INR 2.11 billion in the previous quarter. Recoveries and upgrades from the corporate and SME portfolio were INR 3.59 billion compared to INR 7.01 billion in the previous quarter. There were net dilutions of gross NPAs of INR 1.75 billion in the corporate and SME portfolio compared to INR 4.90 billion in the previous quarter. The gross NPAs written-off during the quarter were INR 17.53 billion. There were sale of gross NPAs of INR 1.14 billion in the current quarter compared to INR 3.27 billion in the previous quarter. The sale of NPAs includes about INR 1.02 billion in cash. The nonfund-based outstanding to borrowers classified as nonperforming was INR 35.43 billion as of June 30, 2024, compared to INR 36.71 billion as of March 31, 2024. The bank holds provisions amounting to INR 19.64 billion against this nonfund-based outstanding. The total fund-based outstanding to all standard borrowers under resolution, as per various guidelines, declined to INR 27.35 billion or about 0.2% of the total loan portfolio at June 30, 2024, from INR 30.59 billion at March 31, 2024. Of the total fund-based outstanding under resolution at June 30, 2024, INR 23.25 billion was from the retail, rural and business banking portfolio and INR 4.10 billion was from the corporate and SME portfolio. The bank holds provisions of INR 8.63 billion against these borrowers, which is higher than the requirement as per RBI guidelines. Moving on to the P&L details, net interest income increased by 7.3% year-on-year to INR 195.53 billion in this quarter. The net interest margin was 4.36% in this quarter compared to 4.40% in the previous quarter and 4.78% in Q1 of last year. The impact of interest on income tax refund on net interest margin was nil in the current and previous quarter and was 3 basis points in Q1 of last year. The domestic net interest margin was 4.44% in this quarter compared to 4.49% in the previous quarter and 4.88% in Q1 of last year. The cost of deposits was 4.84% in this quarter compared to 4.82% in the previous quarter. Of the total domestic loans, interest rates on 50% of the loans are linked to the repo rate, 2% to other external benchmarks, and 17% to MCLR and other older benchmarks. The balance 31% of loans have fixed interest rates. Noninterest income, excluding treasury, grew by 23.3% year-on-year to INR 63.89 billion in Q1 of 2025. Fee income increased by 13.4% year-on-year to INR 54.90 billion in this quarter. Fees from retail, rural, business banking, and SME customers constituted about 78% of the total fees in this quarter. Dividend income from subsidiaries was INR 8.94 billion in this quarter compared to INR 2.91 billion in Q1 of last year. The year-on-year increase in dividend income was primarily due to a dividend from ICICI Securities, ICICI Lombard General Insurance, and ICICI Prudential Life Insurance in Q1 of this year compared to Q1 of last year. On costs, the bank's operating expenses increased by 10.6% year-on-year in this quarter compared to 19% in FY 2024. In Q4 of last year, the year-on-year increase was 12.9%, adjusted for a one-off in the previous year's base, as we had stated on the earnings call. Employee expenses increased by 12.5% year-on-year in this quarter, reflecting mainly the impact of annual increments and promotions that take place during the first quarter of every fiscal year. Non-employee expenses increased by 9.2% year-on-year in this quarter, primarily due to retail business-related and technology expenses. The technology expenses were about 9.3% of our operating expenses in this quarter. Our branch count has increased by 64 in the first quarter. We had 6,587 branches as of June 30, 2024. The total provisions during the quarter were INR 13.32 billion, a year-on-year increase of 3.1% over the provisions of INR 12.92 billion in Q1 of 2024. This includes the impact of the release of AIF-related provisions of INR 3.89 billion during the quarter, pursuant to clarity on the regulatory requirements. The provisions during the quarter were 8.6% of core operating profit and 0.43% of average advances compared to 9.3% of core operating profit and 0.49% of average advances in Q1 of 2024. Adjusting for the AIF provision release and the seasonality of KCC provisioning, which comes in only in Q1 and Q3, the credit cost to advances would be about 50 basis points, which is the adjusted credit cost level we had spoken of in the earnings call for the previous 2 quarters. The provisioning coverage on NPAs was 79.7% as of June 30, 2024. In addition, we hold INR 8.63 billion of provisions on borrowers under resolution, as I mentioned earlier. The bank continues to hold contingency provisions of INR 131 billion as of June 30, 2024. At the end of June, the total provisions other than specific provisions on fund-based outstanding to borrowers classified as nonperforming were INR 234.03 billion or 1.9% of loans. The profit before tax, excluding treasury, grew by 11.8% year-on-year to INR 140.80 billion in Q1 of this year. Treasury gains increased to INR 6.13 billion in Q1 from INR 2.52 billion in Q1 of the previous year, primarily reflecting unrealized and mark-to-market gains on equities and on security receipts. As you are aware, from the first quarter of this year, the revised investment guidelines have become applicable under which the mark-to-market gain on investments classified as fair value through P&L flows through the P&L, which was not getting recognized prior to the introduction of these guidelines. Hence, the future course of treasury gains will depend on these market movements. The tax expense was INR 36.34 billion in this quarter compared to INR 31.99 billion in the corresponding quarter last year. The profit after tax grew by 14.6% year-on-year to INR 110.59 billion in this quarter. Sandeep earlier talked about the capital adequacy position with the CET1 ratio of 15.92%, including profits for Q1 of 2025, and a total capital adequacy ratio of 16.63% at June 30, 2024. These ratios include the impact of the increase in risk-weighted assets for operational risk, which is computed in the first quarter of every fiscal year, and also the impact of the revised investment guidelines that became applicable during the first quarter. Growth in our digital offerings: We continue to enhance the use of technology in our operations to provide simplified solutions to customers. The bank has launched an industry-first initiative SmartLock that empowers customers to instantly lock or unlock key banking services such as UPI, debit cards, and credit cards with just one click on iMobile Pay. About 71% of trade transactions were done digitally in Q1 of 2025, and the volume of transactions through our trade online platform grew by 21.5% year-on-year in Q1 of 2025. We have provided details on our retail business banking and SME portfolio in Slides 25 to 32 of the investor presentation. The loan and nonfund-based outstanding to performing corporate and SME borrowers rated BB and below was INR 52.86 billion at June 30, 2024, compared to INR 55.28 billion at March 31, 2024. This portfolio was about 0.43% of our advances at June 30, 2024. Other than two accounts, the maximum single borrower outstanding in the BB and below portfolio was less than INR 5 billion at June 30, 2024. At June 30, 2024, we held provisions of INR 8.49 billion on the BB and below portfolio compared to INR 9.03 billion at March 31, 2024. This includes provisions held against borrowers under resolution included in this portfolio. The total outstanding to NBFCs and HFCs was INR 854.12 billion at June 30, 2024, compared to INR 770.68 billion at March 31, 2024. The total outstanding loans to NBFCs and HFCs were about 7% of our advances at June 30, 2024. During the current quarter, the increase in the NBFC portfolio was primarily due to lending opportunities to higher-rated borrowers as well as opportunities for investment via the bond market. The builder portfolio, including construction finance, lease rental discounting, term loans, and working capital was INR 521.30 billion at June 30, 2024, compared to INR 482.92 billion at March 31, 2024. The builder portfolio was about 4.3% of our total loan portfolio. Our portfolio largely comprises well-established builders, and this is also reflected in the sequential increase in the portfolio. About 2.2% of the builder portfolio at June 30, 2024, was either rated BB and below internally or classified as nonperforming compared to 2.7% at March 31, 2024. Moving on to the consolidated results, the consolidated profit after tax grew by 10% year-on-year to INR 116.96 billion in this quarter. The details of the financial performance of subsidiaries and key associates are covered in Slides 40 to 42 and 62 to 67 in the investor presentation. The annualized premium equivalent of ICICI Life increased to INR 19.63 billion in Q1 of 2025 from INR 14.61 billion in Q1 of 2024. The value of new business increased to INR 4.72 billion in Q1 of 2025 from INR 4.38 billion in Q1 of 2024. The value of new business margin was 24% in Q1 of 2025 compared to 24.6% in fiscal 2024. The profit after tax of ICICI Life increased by 8.7% year-on-year to INR 2.25 billion in Q1 of 2025 compared to INR 2.07 billion in Q1 of 2024. The gross direct premium income of ICICI General was INR 76.88 billion in Q1 of 2025 compared to INR 63.87 billion in Q1 of 2024. The combined ratio stood at 102.3% in Q1 of 2025 compared to 103.8% in Q1 of 2024. The profit after tax was INR 5.8 billion in Q1 of 2025 compared to INR 3.9 billion in Q1 of 2024. The profit after tax of ICICI AMC as per Ind AS was INR 6.33 billion in this quarter compared to INR 4.74 billion in Q1 of last year. The profit after tax of ICICI Securities as per Ind AS on a consolidated basis was INR 5.27 billion in this quarter compared to INR 2.71 billion in Q1 of last year. ICICI Bank Canada had a profit of CAD 20.3 million in this quarter compared to CAD 16.4 million in Q1 last year. ICICI Bank UK had a profit after tax of USD 7.7 million in this quarter compared to USD 9.4 million in Q1 of last year. As per Ind AS, ICICI Home Finance had a profit after tax of INR 1.17 billion in the current quarter compared to INR 1.05 billion in Q1 of last year. With this, we conclude our opening remarks, and we'll now be happy to take your questions.

The first question is from Mahrukh Adajania from Nuvama Institutional Equities.

Congratulations. My first question is on deposit and loan growth. So incrementally, everyone is complaining about tight deposits, there are some rate hikes that have happened as well. So are you still comfortable with, say, maybe targeting a loan growth of mid- to high-teens? And would you be comfortable increasing your LDR, since it's already lower than peers or would deposits continue to grow in line with loans? That's my first question, and then I have 2 more.

We do not specifically aim for any certain level of loan growth. However, we have managed to grow our deposits effectively this quarter, with an average growth of 17% overall and over 15% at the end of the period. The deposit flows remain robust and support our loan growth. As you noted, deposit rates are currently tight, and wholesale deposit rates have not decreased in the first quarter as they typically do. Recently, there have been one or two increases in retail deposit rates, but some of these are for longer tenures. We need to monitor how the deposit market evolves moving forward, but we do not view this as a limitation to our lending opportunities. On the lending front, we also face price competition, especially in the corporate segment, and we will continue to adjust our strategy accordingly. Regarding the loan-to-deposit ratio, we have historically operated in the low to mid-80s range and I do not expect significant changes. There may be slight fluctuations each quarter, but it should generally remain within that range. Over the next few quarters, we will also need to consider the effects of the revised liquidity coverage ratio guidelines that have recently been proposed, as these will impact both the deposit and loan markets. We will keep an eye on that as we progress.

I have two questions. First, do you have any rough calculation on the Liquidity Coverage Ratio? Can we assume that 90% to 95% of deposits would be categorized as digitally enabled? My second question is about retail recoveries. Are you noticing any slowdown in these recoveries due to discussions around customer leverage in certain segments? In your customer base, are the retail recoveries coming in as smoothly as they did last year? How is that trend developing?

On the first question, I believe it's quite straightforward to calculate since the LCR disclosures are publicly available. From the analyst reports we've reviewed up until yesterday, it seems that major banks are estimating an impact of between 10 and 14 or 15 percentage points, which I consider to be a reasonable estimate. Regarding recoveries, we have indicated for some time that the rate of recoveries will differ and may not maintain the same momentum, as we are still drawing from the pool of non-performing assets that emerged in fiscal '21 and '22. Consequently, this rate will likely decrease, and credit costs will also trend upwards. However, as I stated earlier, credit costs are currently around 50 basis points, and the non-performing asset ratios and provisioning coverage are satisfactory. That’s how we view the situation.

Next question is from the line of Nitin Aggarwal from Motilal Oswal.

Congratulations on a strong quarter. I have two questions. First, regarding the cards portfolio, many banks and NBFCs have reported significant stress in this area, and there is a general rise in delinquencies across the system. How do you view the asset quality outlook for this segment? Additionally, could you provide some insight into the current credit cost compared to the long-term average? Any qualitative details on this would also be appreciated. That's my first question.

Yes. Regarding our card segment, it comprises less than 5% of our loan portfolio. Any changes in credit costs here are reflected in our overall figures. We view this as a growth area and are making investments in both products and distribution to enhance our offerings, as we aim to expand this business. As for credit costs on a broader scale, we're currently operating at around 50 basis points, and I anticipate it will gradually normalize. However, determining the long-term average considering our current portfolio and systemic factors is challenging. I believe it will certainly be better than historical levels.

Okay. But Anindya, also, I mean, this credit cost outlook on the cards specifically, like how do you compare versus long period average?

No, we don't really call that out. As I said, it's about 5% of our book, but it is a book we would be very keen to grow.

Okay. Sure. And the other question is on the yield on advances, which has come down this quarter around 8 basis points. So how do you read that? Is it like that the yields have peaked out and will sustain around current levels? So how do you really read this?

Part of it is the impact of the nonaccrual on the KCC portfolio because there, it's a nonaccrual of interest accrued over a slightly longer period. That would be one component; and there will be some small movements here and there, nothing really specific to mention. Regarding lending rates, I think we continue to see a reasonable amount of competition, especially on the corporate side.

Sure. I would like some clarification on the treasury gain, which is higher this quarter compared to our previous reports. Could you provide details about this gain and how we anticipate it will trend moving forward?

We made gains from our usual proprietary trading activities, which involve trading equities, fixed income, and currency. Additionally, we experienced some gains from our security receipts portfolio, primarily due to redemptions. The third aspect mainly involves the mark-to-market effects on the fair value through profit and loss portfolio. Previously, we only accounted for negative mark-to-market impacts. Now, under new guidelines for the available-for-sale portfolio, mark-to-market effects, whether positive or negative, will affect the AFS reserve. For the fair value through profit and loss portfolio, these effects will directly impact the profit and loss statement. This quarter, we experienced a positive impact in that regard. Overall, even with INR 6 billion, the treasury profit remains a relatively small part of the profit and loss statement.

Next question is from Manish Shukla from Axis Capital.

Just going back to the yield on loans question, Anindya. Q-o-Q, I appreciate that. But even if you look at Y-o-Y, the yields are 9.86% to 9.8%. During this period, the share of retail, SME, and business banking has gone up, which I believe is higher yielding business, MCLR rates would be higher, GNPA proportion is lower and yet the yield on advances have not gone up. What would explain that?

No, I think the yield on advances really has been at a stable level over the last year. If you look at all the categories that you mentioned, there has been no real increase in market pricing, which would have taken the yields up. In fact, if we look at, for example, as you know, even on something like personal loans, the lending rates were at very low-teens kind of lending rates. The mortgage market has been very competitive, as has been the corporate market. So there was no real case for yields to go up. Also, on the SME and business banking side, I think we, and I would guess other private sector banks or most banks, are operating at really the upper end of the quality spectrum. So it's not in itself a high-yield business in that sense. So in that context, I think the yields are quite okay in terms of the yield movement reported.

Okay, sure. Secondly, OpEx growth for the full year, how should we really think about it relative to either balance sheet growth or income growth and if you could talk about it separately in terms of employee and nonemployee expenses?

We don't give guidance on expenses or different components of expenses. But as you would have seen, the OpEx growth has been coming down over the quarters, and the adjusted growth for Q4 was also between 12% and 13%. This quarter, it is 10%-odd. So I would expect that, that should be a fair indicator. I don't think that there is anything that should take it up materially in our business-as-usual sense.

Next question is from the line of Abhishek Murarka from HSBC.

So three questions. One, in cards and PL, do you think any additional tightening is needed or the current growth rates, Q-o-Q growth rates allow you to filter out enough risk and this kind of Q-o-Q trend can continue?

I don't believe we are anticipating any significant tightening. There are some minor adjustments and enhancements that we continue to make. In personal loans, we took various actions last year, and as a result, the growth rate has declined. If you examine the year-on-year growth, it has dropped from 40% to 24%. I suspect that by the end of this year, it will be around 20% or lower. Therefore, I think there is not much more that can be done. The cards segment is also undergoing ongoing improvements, but our focus there is on growing the business. So, to respond to your question, I don’t think anything substantial is needed.

Okay. Perfect. Second question is on corporate loans. Now we've seen few banks growing corporate loans on a Q-o-Q basis this quarter. Is this because there is now some bit of asset quality stress in the retail side and that's why you're moving to this side or there are better rather opportunities in the space? How do we read this? And what's happening in that space, if you could give an update?

It has nothing to do with asset quality in the retail sector. It really depends on the opportunities that arise and the pricing available at the time. In this quarter, we observed growth in both the NBFC portfolio and the real estate portfolio, some of which is at favorable pricing and well within our risk-reward thresholds. In previous quarters, our NBFC portfolio had decreased due to some prepayments, but that has not occurred this quarter. For several quarters, our corporate book has grown at around 10%, sometimes between 8% to 9% in one quarter and 11% to 12% in another, maintaining a steady pace with no change in approach. Currently, we are observing significant competitive intensity in that space, which we will need to navigate carefully.

Okay, perfect. And just quickly on LCR. So just as an approach now, do you need to maintain 20%, 25% additional LCR over 100 on an ongoing basis or once you're reserving higher and anyway, it is more stringent, you don't need to maintain that much surplus, and that can be how you offset the impact of this new circular?

I think we have to think all that through. And we have to, I guess, look at refining both the asset and liability side of the balance sheet. But we'll have to think that through. Not something we can respond as of now.

Next question is from the line of Piran Engineer from CLSA.

Congratulations on the quarter. I want to revisit some earlier questions regarding yields. I'm curious about your perspective on why, despite strong borrower demand over the past two years and increasing raw material costs for banks, no banks, including yours, have been able to pass these costs onto borrowers. What do you think is the reason behind this? Is it possible that in pursuit of growth, you are compromising net interest margins?

No, it would not be correct to say that it has not been passed on at all. So I think if you look at, for example, products, even although it has been very competitive, but products like home loans, auto loans or a number of assets classes, the yields have gone up between certainly FY '22-'23, that is not going up any further now. On the corporate side, I think in two markets, I would say, corporate and mortgages, there is episodes of competitive intensity because I think different banks may have different motivations at various points of time.

Okay. Is it also the case that within each product the customer selection is getting better? So just getting to like Manish's question that the product mix is changing, but then in each product, you're getting to better types of customers, so the effective yield does not change. Is that what's happening?

I would say that for quality customers, banks are quite competitive regarding yield. Broadly speaking, banks are focusing more on the prime end of the spectrum.

Next question is from the line of Param Subramanian from Nomura.

Just one question from my side. Could you explain the quarter-on-quarter movement in net worth because it's up INR 15,600 crores, whereas the profit for the quarter is INR 11,000 crores. So is there something that I'm missing?

Yes. So the revised investment guidelines became applicable in the quarter. And as we have disclosed in our stock exchange release, we recognized an AFS reserve plus retained earnings of about INR 32 billion, net of deferred tax, and that the AFS reserve would have increased a little bit further based on market movements between April and June. So that would be the main component. In addition, some amount of capital and reserves get added every quarter due to stock option exercises. So that's a smaller number.

Next question is from the line of Kaitav Shah from Anand Rathi Financial Service.

Thank you. All my questions have been answered.

Thank you.

Ladies and gentlemen, that concludes this conference. Thank you for joining us, and you may now disconnect your lines. Thank you.