Housing & Urban Development Corporation Limited (HUDCO) Q1 2027 Earnings Call Transcript

Ladies and gentlemen, good day and welcome to Housing and Urban Development Corporation Limited Q1 FY27 Post-Earnings Conference Call hosted by Dam Capital. 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 this conference call, please signal an operator by pressing star, then zero on your touch-tone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Sankeet Cheda from Dam Capital Advisors. Thank you, and over to you, sir.

Yeah, hi, very good morning to all of you. We have with us the entire management team of all to discuss the Q1 results. So from the management side, we have Mr. Sanjay Kulsheshta, who is the chairman and MD, Mr. M. Nagarajar, who is the director of corporate planning, Mr. Daljit Singh Pakhari, who is the director of finance, and Mr. Ashir Gupta, who is the executive director of finance at an ILO. Without further ado, I will hand the call over to Mr. Sanjay, sir, for his remarks. Follow the question and answers. Over to you, sir.

Thank you, Sanket, and good morning to all of you. If you have seen the results, I am sure that you have already seen the results, so I will not go to the numbers, so I will start with the ecosystem and the policy of the company, as well as how we are aligning with the policies of the country towards the Viksibhar. As we all know that HADCO is a sector agnostic company and there is a lot of potential into the urban infrastructure. And it is not the potential, it is the need of the hour that our cities need that kind of infrastructure. If you have observed the last 10 years' progress and the infusion into the urban infrastructure, starting from the basic urban infrastructure of PMAY or Amrit or Swaksh Bharat mission, graduating to metro, RRTS, airports, ports, industrial policies, semiconductor mission, everything, every industry, I think they are attracting more of kind of a planned urban ecosystem and infrastructure. Because it's a capital and human intensive kind of industry that we are working upon. All these things are creating potential business for the company. It may be ring roads, it may be the regional ring roads, it may be multi... Multi-sector kind of infrastructure, multi-model corridors. So, all these things are very capital intensive and we are working with a lot of state entities for creation of the research. And our numbers are the reflection of all these policies of the company. At the same time, if you see on the larger level from the government of India, there is a sense of leveraging of the infrastructure which is already created in last 10 years, whether it is road or whatever it is. So, at this point of time, there is a change in thought also from the subsidy or the grant waste schemes to the bankable projects. And with this perspective, a slight iota of reform has also started into the urban infrastructure. And we have seen the schemes or the projects, I will not say it's a scheme or project, rather it's a fund-based approach. The way Urban Challenge Fund has been dropped in, which is one of the very proactive kind of initiative taken by the government of India, where the 25% to the extent of 1 lakh crore has been earmarked as a subsidy or you can say VGA for the urban sector project. Another 25% has to be cropped in from the state sector. And balance 50% to the extent of two lacrosse has to be created by the private sector players towards the bankable projects. So now the focus is towards the bankability, viability, and the sustainability of these assets. So, it's a key change in the thought, and a lot of states are coming forward with this thought, and they are contributing a lot of projects, and two schemes, two Apex Committee has already sanctioned around more than 30,000 crores. So, if you see the Saski facility from the government of India, there also there are some conditionalities towards the urban infrastructure and a lot of money has been provided for the estate sector. Then if you see the Finance Commission also, so the allocations towards the urban spectrum has enhanced to the maximum. So, all these things, if you see, whether it is a policy, whether it is a thought, whether it is a capital expenditure, whether the preparation of the state towards creation of the new cities, planning new cities, like in Delhi, the Jaivar airport has came in near Delhi. So, new cities are being planned in and around. Bombay is coming with the airport and a lot of urban prognomeration is concentrating towards that side. Naya Nagpur is being coming. In Bangalore also, we are talking. Even the northeastern side, if you see the Meghalaya, the new Shilong is being planned in. New Bhuvaneshwar is being planned in. So, it is not... Only the organic kind of infrastructure which is required for the country, but as we all know, the urbanization level in next 20 years will be to the extent of 100%. So, presently, if it is 40 crores of the urban population, it will be doubled in next 20 years. So, it will be to the extent of 80 crores. So it is 50% of the total population which is projected. So the kind of urban capital which is required for the country, it is giving lot of potential and our results are the small reflection of that kind of commitment and that kind of planning for the country. So I will say with these initial comments, thank you so much.

Should we begin with the question-and-answer session now?

Yeah, you can.

Sure. Thank you very much. We will now begin with the question-and-answer session. Anyone who wishes to ask a question may press star and 1 on their touch-tone telephone. If you wish to remove yourself from the question queue, you may press star and 2. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Sandeep Agarwal from NAR-ID Investments. Please proceed.

Sandeep. Yes, Sandeep, you are audible.

Sandeep, are you there? As there is no response, I am taking the next question from the line of Vijay Singh from Miraya Asset. Please proceed.

Yeah, hello.

Hello. Yeah, Vijay. Hi. Good morning, sir, and congratulations on a good set of results. So, my question is, I wanted to understand a bit more about foreign exposure, short-term foreign exposure. And second one is, owner lending rates. These are two of my questions.

So, regarding the short-term foreign exposure, there is very, very minuscule. We had, we had retarded all short-term foreign currency loans. So, whatever we have, 99%, more than 99% is the long term, that is 5-year borrowing. So, company has planned to take the advantage of this RG Forex window. And we had already borrowed around 700 billion, and we have a tie-up of around 2 billion USD under this facility, and we are trying to enhance this number. But at the same time, we need to see two things, the availability and the cost. So we need to balance on these two aspects. And at the same time, if you see, the domestic loans have also started melting down, so we need to be very wise in deciding the levels of the foreign currency loans.

So, I should understand, you know, we were getting some, you know, some of the challenges on foreign exposer, higher hedging cost and all. So, that cost is not likely to come up in terms of, you know, payment and all, short-term foreign exposer. Am I correct, sir?

Yeah, you are correct.

But finally, we are getting some good funds because our approach is to work with all the lenders. And we had started this work at least two months back, and now we are getting that kind of advantage.

No, but that is for short-term, because in our real calls, you told we are going to proactively manage a short-term foreign borrowing. Hence, we should not have currency depreciation impacted on some higher hedging costs and etc. So, I wanted to understand that point.

No, no. It's not short term. It's 5-year loan. Since RGI has came with the window that if you are raising dollar-denominated loans for 5 years, RGI will be taking care of part hedging cost and we have to take only 1.5% of the hedging cost. So, it is coming out to a very attractive kind of proposition for lender side.

Correct. And my second question is, sir, how is, you know, our portfolio yield and how this is related to interest rate?

I think it is very relevant, but it is continual kind of statement that I can make that our spreads will remain around 2% and our names will be around 3%. You can have a bad calculation of that, but the result, whatever results in a very short term, maybe by this end of this financial year, we will be resting at around spread of 2%. So, you have to understand that the ecosystem in which the HATCO works, it is not a kind of where the bankable projects are almost ready and a lot of cash flows are coming. So, we are very diligent in choosing our projects and at the same time choosing our entities also, so that there should not be any risk of NPA. So, 2% is the NPA, 2% is the spread which is well acknowledged by our borrowers and we will be maintaining that kind of spread. At the same time, we will be continually working towards cutting down cost of funds, cost of borrowing, be it the RBI forex window, be it the internal cost, be it the bank loans, be it the proposition that how we are retiring the high cost loans or we are resolving our assets or monetizing our assets. All these efforts will be continual and will be going through, and at the same time, stress will be around 2%.

Okay. Thank you so much, sir. Thank you so much, sir. Yeah.

Thank you. The next question is from the line of Sumit Rohra from Smart Sun Capital. Please proceed.

Yeah, hi, sir. Very good morning. Firstly, sir, I have to say your results have been extremely strong, so congratulations on that. Now, sir, just a couple of things I wanted to understand. So, you know, we were facing issues, you know, last year of basically the FCNR, etc., you know, for which basically our last financial year, our core numbers were quite suppressed. So, is it safe to assume now that all those issues are now behind us in terms of, you know, all the accounting losses of the foreign exchange? That's my first question, sir. My second one is that in the month of June, you have signed two MOUs, which I see, sir. One is with Gujarat and one is with Bihar. Now, they both are in excess of 1 lakh roll. Can you throw some light on basically, you know, how basically this is going to shape up in the overall sanctioning and disbursement? Because, I mean, sir, you know, I mean, these are big projects which you've, you know, got into, you know, so can you just explain, you know, slightly that today our existing MOU is about 7 lakh crore or something of that sort or 8 lakh crore, I don't recall, but this will further add 2 lakh crore. So, are these confirmed ones which are going to be dispersed or, sir, can you just throw some light and then I'll ask you a little bit further, sir.

So, regarding FCNR, our Director of Finance will comment, and then I will take, because it will take slightly a longer time for me to elaborate on these two MOEs, over two Director of Finance.

Good morning, I am Daljit Singh Khatri, Director of Finance. I think the earlier question was also related to short-term foreign currency borrowings. And so, we do not have any FCNRs in our books which are going to mature in the current financial year or the next financial year. We have a very small portion of FCNR, $200 million, which are going to mature in 2028. So, we do not foresee any foreign currency losses in the current financial year. And the 200 million dollar which is going to mature on 2020 is also adequately secured. We have taken higher protections and we do not foresee any forex losses on that. Rest of the borrowings are long-term borrowings, 5 years ECBs which we have taken and they are also mostly they are going to be covered under the special window of Reserve Bank of India where we are going to take POS that is full protection on the forex.

Sure, sir.

Thank you, sir.

That's helpful.

So, regarding the second part of the question, the MOUs, the philosophy of the company is to work across the country. Presently, we are more intensively working in around 12-13 states, and some of the states were not taking that kind of bigger capital-intensive project. So now our emphasis is to work with these kind of states. And I think the Gujarat is the first stage to start upon, because a lot of bankable projects are coming in, starting from the metro to the roads and the infrastructure for the sports. As we all know that the International Police Games are coming in 29 and then the Commonwealth Games will be there in Ahmedabad in 2030. And then Ahmedabad is also bidding for the Olympics 2036. So all these things require a lot of infrastructure. After a lot of discussions and the deliberation at the government level, the state government level, Gujarat government, And we had signed this MOU, which is backed by a lot of projects which are identified, which includes the infrastructure for the Olympics, finally. And the metro systems, RRTS also, since Gandhinagar, Ahmedabad, and the Sabarmath has to join, and that kind of infrastructure has to come on. A lot of road projects also, the highway projects also, they are planned by the state. So I think it's a way to go in Gujarat. The projects will start coming from the next month. In this quarter, we will be sanctioning some projects in the Gujarat. So, I am very hopeful for that. Secondly, regarding Bihar, as we all know that all these states have to come forward and now Bihar has come up with a Vixit Bihar kind of statement, which is very clear. And when we were discussing with the state, they were more focused towards creation of this capital infrastructure and primarily the urban infrastructure, looking at the resources of the Bihar. That's why we have signed an agreement for creation of 12 satellite tom. We are also discussing some road projects, some tourism projects, and some, the metro projects as well, beyond the housing as well. So, some housing projects are also in the pipeline. So, there is a lot of leverage, a lot of headways in the state government for understanding how these capital projects can come up in the Bihar. And then they want to take the facilities of the Urban Challenge Fund also, which invariably says that the project needs to be bankable. So the role of lender will also be there. So HATCO will remain there as a lender for Bihar government. So on these lines, we have signed the urban structure, this MOUs. But at the same time, if you see the journey of the last 55 years, starting from the consultancy to training to lending, I think we are the best bet for the state government, and I will request our director of corporate planning to, which is more on this aspect of how 360 degree kind of solutions we are providing to the state.

So, good morning. Let me give you a small example. Immediately after signing an MOU, the government of Bihar has come out with a road project, which is almost to the tune of 21,000 crores. Believe me, there is a strict competition for financing states like Bihar, from Nabat, Naftri, commercial banks, and the rate of interest has also gone down so much. So, there is a huge potential for getting a scale. So now second phase is coming with, as CMD has said, full satellite towns, cities like even smaller cities like Nasram, even Patna, they are all coming with the satellite towns, completely independent, integrated, self-contained townships. Government has started a big way in acquisition and also master planning. Harpo is likely to work with both in consultancy as well as in financing and also acquisition. So, I feel that there is a huge potential in tourism, industrial parks, and also satellite tours. And one more example of a small state like Arunachal Pradesh, which is bordering Assam, there is a new airport has come out with. The young IIS officer came and she has projected such a wonderful new concept called a small city, integrated complexes, commercial complexes, bordering Assam. So that shows that each state is competing with the other state and there is a lot of scope for our developmental works.

So, sir, I mean, if I may just ask one thing. So, I mean, the matter of fact is that, you know, you have visibility on these projects and each of them are 1 lakh crore nearly. So, can we safely assume that, you know, today your growth rate which you're talking about are extremely conservative, right? Because, I mean, you know, if you've got clear visibility from Gujarat and Bihar for nearly, you know, sanctioning and disbursing 2 lakh crore, that means, sir, this guidance of ours which we've given of 3 lakh crore by 2029-30, it looks extremely conservative, right? Because, I mean, there is clear visibility which I'm seeing from exactly what you're saying, right? So, is my understanding correct, sir?

To some extent, you are right. Because, you know, the projects, the progress of the project, we didn't extend money like anything. We need to see the outcomes also, we need to see the progress of the project. And there are a lot of things that the state needs to comply before awarding the contract. And the process is not like, it's not an easy process because land acquisitions, social issues, political issues, so a lot of things are there. So, here the arithmetic fails that it will be done by 2029, but I am sure once the project starts, there may be here and there, but finally, generally these large projects are completed within five years of the time. So, it is better to take five years kind of thing. Got it, sir. Got it. Great, sir.

Thank you so much, and I wish you all the very best, sir. Thank you so much.

Thank you. The next question is from the line of Divyam Ketan Doshi from 923 Capital. Please proceed.

Hello, sir. Congratulations on the great set of numbers. I just wanted to know, since we have launched, we have, board has discussed the guidelines about starting PPP Project Finance Division. I wanted to know what's your internal target book size for FY28, FY29, or what's the plan with that?

So... We have repeatedly advised the market that there will not be any target for the private sector sanctions or the disbursement. So it will be on the case-to-case basis and in line with the strategy of the company to support the various sectors, and we had started with the five sectors. One project, two projects rather, we had already sanctioned in Q1 and Q2, the part of Q2. I think in Q1. Q1, we had sanctioned two projects and amounting to around 6,000 crores or so, 7,000 crores. So, maybe the disbursement will start in the later part of this financial year, but if you see the loan outstanding, because sanctions are different, we can sanction any number of projects, but at the same time, the maturity of the project, the documentation, the disbursement has to start, and finally, they have to accept our financial closure. So, in private sector, if you want to go for good entities, the best entity, there are a lot of discussions on the terms and conditions of the loan, and other players are also there. So that's why we had not capped any target. But at the same time, I can assure you that we will go very safe on the private sector. At the same time, we will be supporting the sector also. Under UCF, a lot of PPP projects we are expecting, maybe it's water or self-deserination plants or storm water treatment, drainage, sewerage, where we are expecting good PPP players. And government has also under UCF is extending 50% EGF. So for 50%, we need to check the bankability. And we are discussing with the states to have a user fees kind of framework also. So we are very open for the private sector. It may go as high as possible. But at the same time, the principles will remain same. Good entities, good projects, good concessionaire, strong concessionaire agreements, and a lot of collaterals.

Okay, thank you. And one more question, sir. Can you give me a breakup of the yield on loan separately for urban infra and affordable housing? The end of that comes to 8.78% something. So, can you please give me a breakup?

Actually, there is no separate breakup. Again, I will come to the same point. We are here to support the sector. At the same time, Once the states are coming for a counterpart requirement under housing, which is not happening so often now, that's why our housing portfolio is reducing. So, we are extending that around our MCR of LR of around 8.6. And for other infrastructure, we have a different kind of rates as per the sectors, as per the requirement of the project. So, I cannot say that. So, it is not one rate or two rates, but at the same time, our royalty or our attraction or our commitment towards supporting the housing will remain there, that too, under PMEY. But it's not coming so often for us now.

Okay, sir. Thank you so much. That's it. And all the best. Thank you.

Thank you. The next question is from the line of Arul from Sema Wealth. Please proceed. Hold on, wait a lot. Divacidal. Line will come up. As there is no response, I am taking the next question from the line of Sandeep Agarwal from RID Investment. Please proceed.

Hello. Yeah. Thank you for that call, Shafi. Hello. Am I audible?

Yeah, you are audible.

Just to add on the question regarding the MOU we signed, so currently, as for your presentation, we have currently approximately 6 MOUs, approximately 5 lakh crore. So just again, so what is the timeline of all the projects and roughly approximately 3 to 5 years or something more and how we raise the fund? What is the plan for boring mix?

Yeah, so we had signed the MOU. This is an intent to work together with the states. The MOU is valid in five years, and I am very hopeful that the works on this MOU will start maybe in the last quarter of this financial year or maybe in some of the projects maybe before that also, like in metro of Gujarat, we are expecting very soon. The disbursement will go for another five years. So it will take some time because they are very capital intensive projects and a lot of project formulation, project structuring and a lot of time is required for financial closure to have that kind of feeling that how the servicing will be done. And similarly for other MOUs also it will take five years. The validity is for the five years. So disbursement or sanctions will start in the first year. And last disbursement may go up to up to five years or so. What is the next part regarding the borrowing?

Regarding the raising fund, regarding the budget, and what's the borrowing mix you plan?

Borrowing mix, I think it will remain same. Presently, we have around domestic loans, bank loans. We have the bonds also, domestic bonds, around 40 plus 30 percent. So, 70% is the domestic borrowing, more than 70%. Then we have around 10% ECBs we had already done. So, out of 150 odd crores of the borrowing, we have around 10% of the foreign currency loan and balance is the domestic loan. There is a possibility because of the RBI forex window that for another five years that ECB loans will be higher. Maybe it may go from 10 to 20% of the total portfolio. Let's see how it will unfold. But yes, there is a lot of potential in the ECB side. We are also planning some bonds, but it will be a fractional contribution looking at the rate of the dollar and the other facilities. Finally, the cost will be the key for deciding all these kind of borrowings.

Okay. So just regarding the, so currently, in current quarter, we have a tax rate of 20.16%. So why this is low in the, for the full year tax rate, right, I think?

Oh, so DF will be answering this.

The tax rate is my 20.61. Because, now, earlier we used to, you know, create a deferred tax liability on special reserve, which we used to create, which we are required to create for. Sustaining the long-term financing, but to align ourselves in line with the other government sector and private sector, NBFCs, now we have, the board has decided not to create any detail on the special reserves. So that is my effective, that is why my effective rate has come down.

Okay. Okay, sir. Thank you.

Okay.

Thank you. The next question is from the line of Parth from Dam Capital. Please proceed.

Hi, sir. Thank you for the opportunity. Am I audible?

Yeah, you are audible.

Sir, congratulations on a great set of numbers. Sir, I want to just double check on the growth aspect here. The disbursements have been really strong, the sanctions, growth has been really strong for us. So, what kind of growth, at least in the near term for 27 and 28, are you kind of projecting or internal targets here on the disbursement and AUM growth, sir?

So, we had not worked out for 28, but of course for 27. F by 27, we are planning to have a disbursement of around 65,000 crores. Last year, we had achieved around 52,000 crores. On the basis of this 65,000 crores, board has approved the borrowing plan also. So, it is around how? 70,000 crores. So, in the next year, we had not planned, but 2030, we had planned a loan book of 3 lakh crores, and I am very sure that we will be achieving that 3 lakh crores loan book. But at the same time, in mid of FY28, we will be reviewing on the basis of the achievements of FY27. And in case it is required to have a mid-course correction, we will be definitely informing to the market.

One more thing. I was just looking at the presentation where you have given some break-up of the sessions. Currently, you know, the sanctions have been kind of concentrated on the sanitation, water sanitation side of it, and other segments have just kind of started to pick up. So, sir, what's the outlook on sanctions for the other segments as well?

I think you are talking about the sustainable finance. Am I right?

Sustainable finance, yes, yes. So, sustainable finance is not all included finance.

Beyond sustainable finance also, we are sanctioning a lot of workers. But if you see the sustainable finance, you are right. The water and sanitation are the basic things that we are considering because they are on the priority of the government of India and the MAUA also. And of late, the states are also progressing very well. So, we are supporting these sectors because if these sectors will be supported, lot of other capital projects will also come. So, you can say it's a seed kind of investment that we are making to support the state, and they are coming from the Government of India program of Amrit. So, that's why we have a lot.

Understood, sir. And, sir, just last two things, sir. Can you give some color on the kind of sanctions you have done for this quarter and what's the total sanctions outstanding yet to be dispersed with us? And lastly, sir, when you guided for spreads of 2%, right now, it spreads are closer to 1.8. So, we should believe that this spreads have kind of bottomed out this quarter or maybe because of business must have taken place on the later part of this quarter.

Yes, if you see what we had sanctioned, there are some green roads, expressways, some irrigation projects, then water grids, the drinking water solutions, the industrial development corridors, something in generation and the distribution power side, then urban infrastructure also in Telangana, then Water supply and sewerage projects are there. So, these are the kind of projects that we have financed in first quarter. Regarding spreads, Yes, I think we will be maintaining this 2% spread. I think it will easily come to us. The compression is only account of the accelerated growth within the company. So, we will be resting at around 2%. Maybe in the third quarter, we will see that all these disbursements which we had done in Q4 of last FI and the Q1 of this FI, they will be capitalizing and creating that kind of spread for us.

What's the total sanctioned outstanding for us?

The total sanctioned outstanding, if you see, it is around 2.5 lakh crores, which is already there in last year. We had sanctioned more than 60,000 crores. Last year, we had sanctioned 124. So, a lot of sanctioned pipelines are there. So, now we are into the phase of starting the disbursement in some of the projects. In some of the project disbursement is already started. So, we are in the good space. We have created a very decent or rigid kind of pipeline in terms of the sanctions, and there are a lot of projects which are under consideration. So, regarding the sanction pipeline, we have no question. A lot of potential is there across the state.

Thank you, sir. Thank you so much, and all the very best. Thank you so much.

Thank you. A reminder to all participants, anyone who wishes to ask a question may press star and one on the touchtone telephone. The next question is from the line of Sumit Rohra from SmartCon Capital. Please proceed. So, met are you there?

Yeah, hello. Hello. Yeah, sorry. Sorry, I was on mute. Sorry. So, sir, if you can just talk, I mean, you know, a little bit about the NPA. I think it's zero right now. And secondly, is that can you just throw a bit light on, you know, how do you basically do due diligence on loan, etc.? Because, I mean, you know, we are, you know, got such a great pipeline. So, you know, if you can just talk a little bit about that process also, then it'll give, you know, very high clarity on us, sir. Thanks.

So, our gross NPA is slightly more than 1600 crores and our net NPA is around 82 crores. So, out of the 1,600 crores, around 1,100 crores are at different stages of the NCLT, where we are funding these projects way back, previous to 2013, and I am very sure that we will be resolving these assets during this financial year. They are into the advanced phase of resolution. All the lenders are on the same page. Some of the project has already gone under the liquidation and the orders has already came and the revenues are continuously coming in a part in the franchise. Other, outside the NCLT, there are around 34 crores of the projects. Three accounts are there. And I am also sure that all these accounts, since they are outside the NCLT, very soon they will be resolved. There are some non-consortium projects in NCLT to the extent of 29 crores. That is also in the advanced phase. And now we have changed our strategy and continuously working with the promoters, the NPA developers to understand their point of view. And we are not only dealing with them in VRT and just sending some figures. It's a mutual kind of understanding and we are taking them online and understanding their point of view and how to resolve these assets, understanding their capacity and the capability to resolve these assets. And because of that, we are nearing zero, not zero net NPS, but we are trying hard to resolve all these assets, and I am very hopeful that most of this part will be resolved during this financial year.

Excellent, sir. Thank you.

Thank you. The next question is from the line of Kishore Agarwal from Bajaj AMC. Please proceed.

Hi, sir. Thank you for the opportunity. I have two questions. One, you talked about the disbursement number for the full year. Can you also talk about the repayment pipeline that is there for the full year? I think in Q3, you talked about $4,000 to $5,000 per quarter run rate. Does that still hold true? That is my first question. Okay, but please do you want to answer? Thank you.

Yeah, good morning, Balbir, this time. Actually, total repayment for the year will be approximately 20,000 in the current financial year. Out of that, already 4,000 plus we have received for the current quarter. So, for coming of the quarters in the current financial year, we will be receiving around 15,000 to 60,000. So, accordingly, our total loan signing will be on that basis only. Already the projections for the release are as already discussed. Thank you.

I am very sure that you must be having the number of the loan book by now.

Sir, can you please come closer to the device?

So, with this answer, I think you have understood what will be the kind of loan book we will be having by this financial year. Next question, please. Yeah, we can go for the next question.

Thank you. The next question is from the line of Vaibhav from Nirmal Bank Securities. Please proceed.

Yeah. Hello, sir. Thank you for the opportunity. So, in this quarter, we reported the yield on loans of 8.78%. So, what are our expectations for the upcoming quarter, and what is our strategy to protect our yield for the upcoming quarter?

So, yeah, yield is around 8.78. At the same time, our cost of fund is also reducing, and we are continually trying to cut down our cost of fund. So, beyond yield, I can make a statement that we will maintain our stress and the name is. And repeatedly I am advising that our spreads will be 2%. So, yield is a function of lot of things. If our cost of the borrowings are increasing, we are passing some part to our borrowers also, because we are into that spectrum where we need to support the urban infrastructure. So, for sure, our spreads will be maintained at 2% and NIMS will be at 3%. Okay. Thank you.

Thank you. The next question is from the line of Vishal Gajwani from Aditya Birla ANC. Please proceed.

Hi, thanks for the opportunity. I just wanted to check on the borrowing profile. We have raised, I think, 1,800 crore rupees from this RBI Forex swap window. So, what is the kind of full-blown loans that we can get from this window over the next couple of months? Thank you.

I will again answer this. We had already borrowed around 700 million under this facility. We have a tie-up to the extent of around 2 billion USD. So the total 2 billion USD tie-up is there. We are targeting to enhance this number, but I cannot comment on this enhanced figure. But there are a lot of discussions that we are doing with a lot of banks, domestic banks as well as the international banks.

Okay, so this 2 billion is something that we would plan to utilize fully, if not more.

2 billion will be the minimum figure.

Okay, sure, sure. Thank you. And what is the cost of borrowings here, including hedging cost?

Also, since RBI is taking care of entire hedging and we have to only have a provision of 1.5%, so it is coming at around plus minus 6, you can say, 10 which is a point here or there.

Okay, okay. Perfect.

So, 5.5 to 6.5, our finance department is telling me, it is between 5.5 to 6.5.

Okay. Okay. Sure. This is helpful. Thanks a lot.

Thank you.

Thank you.

A reminder to all participants, anyone who wishes to ask a question, may press star and 1 on their redstone telephone. I repeat, anyone who wishes to ask a question, may press star and 1 on their redstone telephone. As there are no further questions from the participants, I now hand the conference over to the management for closing comments. Over to you, sir.

I think if there is no position anymore, we can control this arming call. Thank you.

Yes, you can give the closing remarks.

Thank you. Thank you so much.

Thank you. On behalf of Dam Capital Advisors Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines. Thank you.