Housing & Urban Development Corporation Limited (HUDCO) Q2 2027 Earnings Call Transcript

Ladies and gentlemen, good day and welcome to the Housing and Urban Development Corporation Ltd. Q2FY27 Earnings Conference Call hosted by Ashika Institutional Equities. As a reminder, all participant lines will be in the listen-only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star, then zero on your touchtone phone. Please note that this call is being recorded. I now hand the conference over to Ms. Rathi Pandit from AASHIKA Institutional Equities. Thank you and over to you.

Thank you, Yashashree. A very good afternoon to everyone. On behalf of Ashikash Institution Equities, we welcome you all to the Q2FY27 Earnings Conference Call of Housing and Urban Development Corporation Limited. We are pleased to host the senior management of the company, represented by Shri Sanjay Kulshrejta, Chairman and Managing Director, Shri M. Nagraj, Director of Corporate Planning, Shri Daljit Singh Khatri, Director of Finance, and Shri Achal Gupta, Executive Director of Finance. I now hand over the call to Chairman Sir Shri Sanjay Kushishtra for his opening remark, post which we can have the floor open for Q&A. Thank you and over to you, sir.

Thank you, Ishikam. Good afternoon, friends. At the outset, I will extend my warm greetings to all the investors and the stakeholders. I also take the opportunity to wish everyone a very happy and prosperous Diwali. May the festival bring happiness, prosperity, and new opportunity. So if you see the journey of the hud ko during last two, three years, The times were very happening. There were a lot of commitments from the government of India, not only towards the financial supplementation, but also towards the policy side. There were a lot of announcements in the budget regarding a lot of missions and a lot of programs. If you see the bottom line and the thought of the government of India is that for the Bixit Bharat, we need the Bixit cities, the developed cities. And for developed cities, we need a lot of capital inclusion, a lot of planning, and a lot of emphasis towards the reforms and the government. So during H1 of the 27, HATCO has delivered a strong performance because of all the reasons I had mentioned. During the first half of FY27, it reflects the sustained business momentum and improved operational efficiency. The disbursement of the loan stood at around more than 35,000 crores, which is around 37% more than the previous financial year, and our loan sanction has reached to more than 1 lakh crores during the first half year lease. The pipeline is very strong regarding the disbursement, and we are completely aware that a lot of disbursements will be planned in times to come. The loan book has grown by 29% and it has become 1.86 lakh crores. The revenue from operation has also increased by 26%. The net profit has also increased by 31% during half year. Asset quality continued to improve, and we are very aggressively working towards the resolution of the balance assets also, so that we can use that capital. Our gross NPA has declined to around 0.7%, and net NPA is just above 0, that is 0.04%, and we are committed to become 0 NPA company very shortly. We had also worked toward cutting down of cost of funds and by taking the various measures and various steps not only towards the policy but also we are taking benefit of this RBI swap window. Our blended cost has been very stable respective with the turbulent markets. It is now at around 7.07 percent, which reflects our continued focus on resource optimization despite A rising interest rate regime, and elevated corporate bond yield. These achievements reflect, of course, strong fundamentals, prudent risk management, and consistent execution of both strategies. You may all be aware that there are a lot of geopolitical issues which are there in the… International domain and because of these uncertainties, there are a lot of uncertainties in the money market, be it the rising of the dollar or the crude or tightening of the monetary policies, including the raising of the repo rates by the RBI. So, all these winds are coming for us, and we are targeting that how to resolve that our continual growth will become at an optimum level, and we will continue to find our growth space. As we were doing recently. And we are very consciously pursuing to diversify our funding strategies, leveraging multiple resources, it may be domestic, it may be international, optimizing our cost of funds. At the same time, we are also addressing that there should not be any risk perceived while taking the international loans, and that's why we are taking full advantage of RBI swap window. So, our resource monetization strategy is closely aligned with our asset management. So, we are fully aware that we need to balance our asset management as well. By continuously optimizing our borrowing mix and the funding cost, we aim to strengthen our competitive edge in lending operations, protect margins, and ensure sustainable growth. Our endeavor is to translate resource mobilization efficiencies into the competitive lending rate, thereby creating long-term value for our stakeholders. If you see the infrastructure story of the government of India and our country, India, there are a lot of emphases there on the urban ecosystem and how to create a very viable, bankable, and sustainable urban infrastructure. So, it is not only about the trunk infrastructure on which the government of India is extending a lot of missions and a lot of programs, starting from the PMAY that is ensuring the housing for all across the country, and PMAY 1 was very successful, and now the PMAY 2.0 is also launched. Along with the housing, we are also aware that there are a lot of missions towards water, that is Amrit 1, Amrit 2, the smart city missions were there. So, Aksh Bharat mission is also there. Alongside, government is pushing the mobility also, be it metro, rapid rail, or Vande Bharat, or air networks through Iran programs, or industrialization through various programs, be it the food parks. So, lot of things we are transforming and everything, if you see, is enforcing the view that the creation of the urban inauguration. We are very fast in our urbanization, our pace is very fast, and it has been estimated that by 2050, our urban population, which is... This will be doubled by 2050. So, there is a big challenge towards the urban ecosystem for creation of this infrastructure, which is not only for the facility, but also it will create a growth engine for the country because around 60 to 70 percent of the GDP is coming from the urban network only. With this challenge, government has also announced the Urban Challenge Fund, wherein the 1 lakh crore is the subsidy or the grant portion that the government has decided, and another 1 lakh crore has to be infused by the state government. So for 2 lakh crores, it will be the private participation has to be seen. So in other words, you can say it is a 50% VGA for the urban infrastructure that the government of India in association with the state government has announced. So it will unlock a lot of private capital. It will also leverage a lot of assets which are there with the ULBs or with the cities. Government has also came out with the Shaski loans. It's a 50-year interest-free loan to the state, which is primarily used for the urban ecosystem. The 16th Finance Commission has also raised a lot of grants for the state, which will also become a driver in the growth story of the urban networks. So, the objective of the government is to create the growth engine, the cities as a growth engine, redevelopment of the cities. And alongside, there is one program which is also announced, which is city economic region, wherein the main city will be identified, its economic activity will be identified, and other cities will be developed with backward and forward integration of this economic activity. For that also, a lot of funds have been earmarked in the budget. So, if you see HUDCO is at the epicenter of starting from the housing to the infrastructure across the country,

lot of programs are supplementing the efforts of the HUDCO.

That's why this is the main reason that our loan book is continuously growing, and this story is just started. It may be continuing for another few years. We will be supplementing the efforts of the government for creation of the developed nation by 2047. So, we are a sector agnostic company. So, across the sectors, we are financing. Other than that, we are financing the new satellite towns or magnet towns or industrial towns as well. Then the ring roads or the mobility also we are supporting in a big way. We are also working on our SDG and ESG structures so that whatever loans we are extending, they will be compliant with the ESG guidelines so that our international stakeholders will not have any issue regarding the financing. We are very closely working with the multilateral banks like World Bank, ADB, KFW, AIIB, NDB. So they are also supporting our point of view and the objective of the nation. So I am very, very, very sure that the way the company is growing and supplementing the efforts, we have already achieved around 1.86 lakh crores of the loan book. We are targeting that during this year, this financial year, we will be around 2 lakh crores. And by 2030, we had given an initial guidance two years back that we will be achieving around 3 lakh crores loan book. So we are working on that. We are trying that our spreads will be maintained at around 2% and NIMS will be at 3%. All the financial ratios are very well under control, which is supporting the business model of the company. Government is also supporting since we are a 75% owned government of India company. So it's a company of the strategic importance and we are working. So, what repurposing of HUTCO, within HUTCO also, and creating a lot of strength, not only through the recruitment of the new officers, but also through the capacity building across the company. We had started Urban Invest Window recently, last year. It's a you, I win. So, you win, I win. It is primarily to identify the assets of the ULBs, to create the project, then their structuring, and then their financial closure. And at every step, there will be a capacity building of these state entities and their officers. So, we are focusing to become a purely a 360 degree kind of output oriented and outcome oriented company in terms of the urban infrastructure. So, with this, I will not take a lot of time. Thank you so much and we are open for your question and answer.

Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and 1 on their touchstone telephone. If you wish to remove yourself from the question queue, you may press star and 2. Participants are requested to use answers while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. First question is from the line of Sanket Cheda from Dam Capital Advisors. Please go ahead.

Yeah, hi, sir.

Congrats on a good side of numbers. What I wanted to understand is we're fairly certain about the growth looking at the displacement and sanctions. But I wanted to get more sense on yield holding up while we pursue this growth for next couple of years and thereby margin. So how would you suggest an outlook on both of these things? Cost of funds, I leave it to market dynamics and hence not bulging on that. But how would you see your yields moving and thereby margin over next one, two years?

So, Sankheesh, good morning. How are you?

I am good, sir.

So, if I have understood correctly, you are asking about how we will be sustaining the interest and net interest margin. So, I can assure you and the investors fraternity. That our spreads will be around 2% and we will be maintaining on year-to-year basis. There may be a slight correction during the year because of the market fluctuations, cost of borrowing, the timing of the disbursement, the resets which are happening across the loan portfolio because we resets on trans-to-trans basis. So, there may be a temporary slowdown towards the spread, but I can assure you that it will remain 2% at the end of the financial year, and we will be sustaining across the journey the spreads of the 2%. Similarly, the NIMS we are targeting that it should be at least 3% and we are maintaining that. And if you see, without this EBR of 20,000, presently also our spread is 1.96%, which is just around 2%, and our net interest margin is 2.93. So, for the sake of other knowledge, I can tell you that 20,000 crores in our loan book is a loan to the government of India, which has a spread of only 40 business points. So, if you reduce this amount, then the spreads are around 2% and the net interest margin is currently at 3%.

And when is that moving out, sir, in terms of the repayment to do?

28-29 it will be, it will be out from this.

FY 28-29.

Okay, okay, okay. Yes, sir. I think, yeah, I just wanted to know that. And the other thing which we didn't have in this quarter, which is transitional losses due to the currency movement, as we had highlighted last year, that from hands-on, we won't be seeing that, and that would stay, right, going ahead as well.

It's a very miniscule amount, so it will stay for zero. It is zero. So it has been zero now. So there will not be any loss towards it.

Going forward also we don't foresee any Any losses on foreign currency translation, because now our loans are remaining maturities basically five years and sufficiently has most of the foreign currency exposure which we have today is covered under the RBI swap window, which allows for full protection against the Only thing is small portion of HCNR is there which is which will be maturing in 2028, so going forward we don't foresee any losses on foreign currency movement.

Okay, okay. So, sir, and lastly just I joined to call a couple of minutes, have you spelt out any disbursement target for this year?

Disbursement target, yes, we had got an internal target of 65,000 crores, and during H1, we had already achieved more than 35,000 crores, so another 30,000 crores is left in our target.

That would be minimum, right? You can exceed that target?

It's a target depending on the pace of the project, because we didn't disburse like this. So, it will be the project progress on the basis of that, this 30,000 crores has been estimated. So, in case the pace of the project is expedited, there is yes, of course, the disbursement may high. But I don't see any reason to correct this figure of 65,000 crores as of now.

Okay, sir. Sure. Thanks a lot.

Thank you. Next question is from the line of Devaraj from Forensic Investing. Please go ahead.

What's this, sir? I just want to know the previous part incident, right? So whatever is our lending book, right, asset book, that is we can reset, right, that interest at a particular after six months or nine months, something like that?

There is a one-year reset that we are extending to all our loans. So, it's a trans-wise one year. So, once one trans completes its one year, then it will be resetted as per the MCLR. And our MCLR, that is the benchmark rates, are revised on quarterly basis.

Okay. Okay. So, basically, whatever, if there is an increase in our borrowing cost, post one to one and a half year, it will be reset. So, there won't be any compression in the names.

Yeah, yeah, there will not be, it is only one year, so there will not be any comparison, whatever we will be, the cost will be hiring, it will be passed on to the borrower at that interval.

Okay, noted. And regarding the resolution, right, so, sir, is it possible to know that how our organization keeps such a minimal net NPA, right, and if there is any resolution, you know, would we encounter some difficulty?

I don't say it's a difficulty in resolution because we are very, very aggressive and continually working towards not only the one-time settlement but also aggressively pursuing at the NPLT or NPLT labels or the valuation labels. It's a two-way kind of resolution that we are working. It is not alone the courts or the decisions of the courts that we are relying on, but we are evaluating, we are discussing with our borrowers, understanding their issues, and settling their projects. Because these projects are... Way back dispersed the 20 years or 30 years of the time. So, a lot of things have been changed. So, proactively, we are discussing with them. And if you see during H1-27, we have a recovery of 32 crores and resolved around 359 crores. In 25-26, we have recovered around 403 crores and resolved around 660 crores. In 24-25, we have a recovery of 416 crores. So, if you see, we are very aggressively resolving these checks, recovering our money, what is possible within the framework. And most of these cases which are balanced, the orders had already received. They are under various stages so that the money will come. Some of the project has gone to the liquidation. So, time to time, we are started getting the monies also. So, I'm very hopeful that this miniscule amount of 1200 crores, mostly it is pertaining to the NCLT and the DRAT. So, most of these amounts will be resolved in a year of the time, and we are very strongly pursuing with the consortium partner as well as the NCLT process.

Great, sir. We are thankful to the management, right, for such great support. But, sir, we don't face challenges in government and semi-government organization, right, for recovery. Sir, see, this resolution is private entity, right, but in government and semi-government, right, some punishment example, yes. So, we want such challenges, right, in risk of risk.

So, most of these, around 95% of these loans are to the private sector entity, and that's why we are... We have a lot of discussions with the private sector players and most of these are from the private sector side of it.

Okay, but sir, some of the assets have been backed by mortgage. It was around 20-25 sold assets. Now the value of the assets have gone up substantially. We are very sure that we will be recovering our amounts.

Okay, okay. Noted, sir. I will join the interview. Thank you, sir. Thank you.

Thank you. Next question is from the line of Harsh Usogi from Aashika Institutional Equities. Please go ahead.

Hi, thanks for the opportunity. Am I audible?

Yeah, you are audible, Harsh.

Yeah, so I just have three questions. So firstly, I mean, we've highlighted in our presentation that there's a 3 lakh floor opportunity under finance infrastructure, which consists of housing and urban infra. So which sectors should we primarily, I mean, which sectors are we primarily going to focus on there? And second question being, under the PPP project financing, have we commenced our sanctions, I mean, sanctions and disbursements? And the last question being, what is our outstanding, what is the number for outstanding sanctions and in how much time do we expect to convert it to disbursements? So, yeah, those were my three questions. Okay.

Yeah, Harsh, actually, if you see, we had kept a target of 3 lakh crores of the loan book. But the opportunity is very huge in urban sector as per the World Bank report. It requires around 250 lakh crores by 2050. So we had taken our share till 2030 of the loan book of 3 lakh crores on which we are working so that our ratios should not get disturbed. Secondly, you had asked regarding the PPP. We had already started sanctioning of the projects. We had sanctioned one redevelopment of the biggest slum project that is in Mumbai, Dharavi. It is in the advance. Stay of the documentation and we are very hopeful that during this quarter the disbursement will start. Other than this project, no disbursement has been started under the PPP mode, but we have sanctioned around 9000 crores of the PPP projects. They are primarily from the redevelopment of the slum, the road sector, and one is from the renewable energy side also. Regarding, third question was regarding the outstanding pipeline, there is no dearth of the outstanding pipeline, if you see, every half yearly we are sanctioning around 1 lakh crores. Last half yearly also we had sanctioned 1 lakh crores. We have a pipeline of projects which are sanctioned between 3.5 lakh crores to 4 lakh crores. And since they are long gestation period, starting from the three years to the five years of the time, so the conversion will take some time regarding the disbursement and the loan.

Okay, thank you. That's very clear, sir. Just one small bookkeeping question. If you could provide the cost of borrowings for banks, bonds, and ECBs respectively?

Yeah, yeah, ECD, I mean, we have. During the current financial so far, we have raised $2 billion, and effective lended cost after hedging is slightly less than 7%. It is around roughly 6.75%. Coming to the bonds, as you see, the bond rates are quite elevated these days for the last two and a half months. It is hovering around 8%. So we have not raised any money through bonds in the last quarter. We raised in the first Q1, we raised around 2,200 crores through bonds. That was roughly 7.25, roughly. But after that, the yields have gone up. So we are not resorting to and we are waiting for the right time to go for bonds. From banks also, we are able to raise money at around 7.25%.

Okay. Thank you so much, sir. I will join back with you.

Thank you. Next question is from the line of Nimmin Doshi from Fortress Group. Please go ahead.

Yeah, hi, sir. Thanks for the opportunity. First, coming back to your yield, sir, if I see there has been on a YOY basis and a sequential basis, you have seen some compression in yield. So what gives us confidence or are we seeing that the resizing is yet to happen and will happen in next few quarters and will be packed with our spreads of 2%? Because cost of funds, we don't see much of a relief anyway, either from the bond market or from the NPLR. So what gives us the confidence that we'll be able to maintain or end the year with a 2% spread?

Yeah. Thank you, Mr. Doshi. I think very relevant question, and we all know that the cost of fund is increasing. We have taken several measures. One, as my colleague has already informed that we are very aggressive to take the benefit under this RBI swap window. We had already borrowed around $2 billion. We had already taken at an average price of around 6.5, quarter to 7. It is in between that. So, the total amount we are targeting is slightly more than $3 billion. So, other loans are also tied up and the disbursement will come before 31st of July. December before the closure of this window. So if you see the total loan book is 1.86 as our total borrowing is around 1.65 and out of that around 35,000 will come at around 6.5 to 6.75. You can say 6.75. This will create lot of, this will reduce lot of pressure on us regarding the borrowing side. So that's why we are very aggressive on this. Secondly, we have increased the MCLR after the gap of two years. So, we had already started increasing our MCLR by 15 basis points. We had already increased, and I have already mentioned that our loans are being resetted on a yearly basis. So, we had estimated that around 20,000 crores of the loan will be resetted during this half-year lease. So, that will also increase our bottom line. Other than that, whatever we are discussing with the state, our negotiations are being done, and now we are changing our pattern from one-year research to the quarterly research in some of the cases. So we have started implementing that idea that the research should come on every quarter to quarterly research. So there are a few more things that we are discussing, but I can assure you that with all these measures, Because our resets are happening, so there will not be any question regarding the passing of this increased loans. And our states also understand because they are also issuing the SDL. So everybody knows that the pricing is increasing, so there is no problem regarding the resets and the transmission of these higher costs.

Okay, so can we say that this quarter, please, more or less from a resizing front, would have bought out and from now on?

I'm sorry, Memen, your audio is not very clear. Can you use your handset mode, please?

Hello, am I audible now?

Yes, please go ahead.

Yeah, I was just saying, can we say that the yields are more or less bottomed out and we could see increase in yields from here on for the next two quarters? Yeah, they will be increasing.

Rather, I can say that we will be maintaining 2% spread and 3% of the name.

Perfect, perfect.

Because if you see our position, we want to create that kind of infrastructure.

Got it, got it. And so, when you say 3% spread, 3% NIM, when I see, when I look at your other operating income and other income, we haven't seen that of a growth. I mean, the disbursements are growing upwards of 30-35%, whereas your other income and operating income are still more or less in the same line with the NIA growth. So, where do we see the incremental 1% spread over and above this NII spread? So, how do we see this other income gap going?

It is, Mr. Doshi, it is not the other income, it is the return on our equity, and that is creating the higher names. Other than that, other income, we are also working towards the monetization of our assets. But I will not talk about that.

And I think there is some disconnect also, I think. I mean, our target for spread is 2% and NIM is 2% which we are presently also maintaining and going by the cost of funds which we are able to have and the yield we are having or we are expecting to further increase by another, I mean, the transmission effect of 15 basis points will also give a result in the Q3 of the financial year and the impact of ECB which we raised, that also will be, you know, reflected in the Q3 results. So, what sir is saying, target is 2% for spread and NIMS target is 3% and we are very close to it and we are, we will maintain that.

Got it, got it. And lastly, sir, on your tax expenses, how should we see the tax rate going ahead for us?

Tax rate will be the same in the future.

So 20% or currently it is at 18.5? It is roughly 21%. Okay. Okay. Got it. Got it. That's it for myself. Thank you on all the rest.

Thank you. Next question is from the line of Divyam Doshi from 923 Capital. Please go ahead.

Hello, sir. Very good morning. I just wanted to ask one simple question that RBI has placed us in the upper layer in August, I think. So, what effect does that make for us and does that affect any lending of ours?

So, as we all know that RBI has notified recently regarding this list of the upper layer entities and ADKOR is one of them because our loan book is 1 lakh crore. So, if Arday talks about the upper layer, it is regarding the more compliances. Exposure limits has to be monitored and approved by the board in case we are extending from 25%. So, since we recently created MBFC, IFC, the impact on the company may not be so much because we are starting from the clean slate and whatever we were doing, we were doing actually complying the regulation of the upper layer from the day one. So, I don't think any impact will come, but yes, the compliance will be more from the RBI side, and I don't think more than that. Except minor exposure norms. Minor exposure norms, that is, 25% can be done, and 5% can be done by approval of the board. We are not in that position since our loan book is not so big. So, that kind of issue will not be there with the company. So, I don't see any bottleneck, but yes, compliance has to be done by the company.

Okay, okay. And one more question, please. How is our private business doing?

Private, we had recently started. I think we had discussed and a lot of discussions for one and a half years and we have came out with our guidelines. And recently, we have sanctioned a few projects. One is the redevelopment of Bharavi, wherein it is in the advanced phase of documentation. We have sanctioned some projects, road projects as a part of consortium also, HAM projects, and one project in the energy sector. So, total sanction is 9,000 crores, but the disbursements are not yet started.

Okay, and when will be the disbursements?

Maybe in this quarter, we are trying that this workman should start.

Okay. Okay. That's it. Thank you so much, and all the best. Happy Diwali.

Thank you. Happy Diwali.

Thank you. Next question is from the line of Devaraj from Forensic Investing. Please go ahead.

Sir, in the non-sovereign lending, right, so what is our strategy, sir, which are incremental lending to the non-sovereign parties?

So, if you see the non-sovereign lending we had started, but we are very, very sensitive towards the fact that there should not be any risk towards financing of these PPP projects, and whatever we will be doing or we are doing started, it will be in the PPP, and we will see that the strong concessionary agreements should be there, the entities should be very strong, the appraisal mechanism should be very strong, the monitoring should be very strong. So we are not compromising towards the asset quality at the same time. There is a prerequisite that the entity should be in the investment grade, then only we will be funding these kind of projects. So there is no target for funding of the PPP project at the same time. We will see that the good entities will come, good projects will come, which are backed by good concessionary agreement or regulatory arrangements like in the power sector. So, all these kind of things we are looking and there is a third party due diligence also we are, we are, there is a condition of third party appraisal by the, by some, say, retail or whatever kind of agency. Then there is a PMA, then there will be a TRA. So, lot of, lot of protections and risk mitigations measure we have taken while extending any credit to the PPP partner.

Okay. And, sir, risk will get adjusted, right? Risk premium will be more there. Rending rate will be more relative.

Obviously. But, it's a, you know, it's a very competitive market. But, yes, of course, the risk premium with respect to the state government will be more.

Okay. Not at all. Thank you.

Thank you. Thank you. Ladies and gentlemen, to ask a question, please press star and one on your phone. Next question is from the line of Harish Ulsogi from Ashika Institutional Equities. Please go ahead.

Yeah, thank you. So, can we provide some guidance on ROA and which constituents of DuPont will drive it? And I have another question. Are we, I mean, expecting credit costs to be negative going forward as well and till then, which year will this continue?

Regarding ROA, we are trying to maintain between 2 to 2.2%, and definitely we will be maintaining that kind of ROA. But we all know that when there is an accelerated growth in the company, sometimes ROA comes down and when the loans are settled, then ROA will come again to the between that margin. So we will be maintaining. And I think this is one of the best figure in the industry regarding the ROAs. Regarding the cost, yes, I think for a year or two, there will be some negative cost, some resolutions will be happening and there will be some reversals because the provision coverage ratio is around 95%. So there will be, definitely there will be the reversals for a year or two.

Sure. Thank you.

Thank you.

Thank you. Our next question is from the line of Rati Pandit from Ashika Institutional Equities. Please go ahead.

Question.

How is this section under PMI and Urban to Yojna and whether we anticipate some further sanctions to come under that? And also, we have given the guidance of 3 lakh crore AUM by next year. So, are we likely to revise that guidance now that we have almost a 2 lakh crore book? Yeah, so these are my questions.

Thank you.

There's slight disturbance in the lines. Are we audible?

Yes, sir, you're audible. I have muted Rathi because there was some disturbance. You can go ahead, sir.

So regarding PMAY, PMAY 1.0 was started in 2014 and it has a lot of impact across and which has a multiplying effect towards the water, roads, seaways and everything. So we were funding on that front also. Under PMAY in totality, PMAY 1 and PMAY 2, we had sanctioned the amount of around 58,000 crores and we had released around 48,000 crores. Under PMAY 2, around 20 lakh dwelling unit has already been sanctioned, and government has a target to sanction around 40 lakh units during this financial year. But if you see the total investment which is required is around 4 lakh crores in other times to come. So definitely our loans will also be extended towards this PMAY counterpart requirement of the state. But only thing is that finally, if in case the state wants that kind of counterpart requirement, then only they will come to us. Otherwise, states are arranging themselves this kind of money through SDL. So, in case any state wants, we will be supporting this cause of the Government of India commitment towards this PMA-Y. And we are discussing with a lot of states, but good states are arranging their own money through STL because it is the cheapest form of the money for this non-renovative sector of housing. But other than that, they are taking our assistance towards a road or ring road or port or airport. So our funds are primarily used for these kind of works, which have a multiplying effect on the economy of that particular state.

Thank you. I now hand the call over to management for closing comments. Over to you, sir.

Thank you so much, and thank you for having faith in us and whatever we are doing. But I can tell you with full assurance that we will be very transparent. While declaring any guidance to the market, be it threats, names, or our loans, and we will be very, very conservative not to take the risk, and at the same time, we will be very, very competitive in financing good projects. We are repurposing ourselves so that we will become the primary player which will guide the urban infrastructure for the country. And that's why we have started repurposing us. We have started strengthening within the organization also because we believe that if our organization is strengthened, then only we will continue to grow like this. Towards risk side also, we are working very aggressively that there should not be any risk, there should not be any new NPA. At the same time, we are very serious on the compliance fact that there should not be any lack of compliance towards the RBA. Then we are very, very aggressively pursuing and working with the state government, strengthening our regional offices so that the monitoring of the projects, so whatever projects we are monitoring, they should be monitored well, and the disbursement have a kind of phase so that it should not go out of phase. We are continuously working that our disbursement will be on the quarter-to-quarter basis so that market will understand this is a disbursement and we will be lending at this figure at the end of this financial year. We are very proactive in innovating kind of resource management and also with the ALM and cutting down our cost of funds so that the optimum pricing of the loans can be done. And we are monetizing our assets also. A lot of assets we are monetizing and around 1 lakh square meters of the space we will be creating in the next three years of the time. And we are expecting that income will start coming from that. On the future side, a lot of new ideas we are working, we are setting up a strategic business group also. So that, because if you see in urban landscape, lot of transformation is being done and we have to change on day-to-day basis. So that's why all this flexibility we are creating, all this resilience we are creating within the organization to be fit for any kind of market requirement, to customize our needs and requirements in line with the solution for the urban local body. Thank you so much.

Thank you, members of the management team. On behalf of Ashika Institutional Equities, that concludes this conference. Thank you all for joining us today. You may now disconnect your lines.

Thank you. Happy Diwali. Happy Diwali.

Wish you the same, sir. Thank you.