Indiabulls Housing Finance Ltd

NSE:IBULHSGFIN

Earnings Call Transcript 2023-Q4

[Operator]

Ladies and gentlemen, good day, and welcome to the Indiabulls Housing Finance Q4 FY '23 Earnings Conference Call. [Operator Instructions] Please note that this conference is being recorded.

For the call, we have with us Mr. Gagan Banga, Vice Chairman, MD and CEO; Mr. Sachin Chaudhary, Chief Operating Officer; Mr. Mukesh Garg, Chief Financial Officer; Mr. Ramnath Shenoy, Head, IR and Analytics; Mr. Pinank Shah, Deputy CFO; Mr. Ashwin Mallick, Head, Treasury; Mr. Veekesh Gandhi, Head Markets; and Mr. Hemal Zaveri, Head Banking.

I now hand the conference over to Mr. Gagan Banga. Thank you, and over to you, sir.

[Gagan Banga, executive]

A very good day to all of you, and welcome to the quarter 4 and full year financial year 2023 earnings call. In the fiscal year '22, '23, we have consolidated on the foundation laid in the previous year, which was fiscal '22. Co-lending and asset-light path of growth, which amongst our peers, we were the first to pick up on, has now been accepted and adopted by all industry stakeholders, including banks, other nonbanks, rating agencies, et cetera.

This year, we have disbursed retail loans of almost INR 8,000 crores under the asset-light model. This is over 2.5x of what we had disbursed in fiscal '22. We now work with 8 partner banks and for each of these partners, we have a strategic relationship as we make meaningful contribution to their incremental retail book within the product segments that we have tied up with them for. For us, in turn, this is highly earnings accretive model and gives us access to a relatively unlimited and ALM match resource pool. Our balance sheet and loan book as a result are now stabilizing. And in fact, we registered a slight growth over quarter 3 fiscal '23 with balance sheet at almost INR 75,000 crores and loan book at over INR 54,000 crores.

Now I will firstly cover an important update on the reorganization and rebranding we discussed last quarter as one of our strategic focus areas for the fiscal year -- fiscal and the year ahead. Please refer to Slide 4 of the earnings presentation. The exit of the country's largest housing finance company from the nonbank space by the end of the current quarter, which is quarter 1 fiscal '24, provides the company with a unique opportunity. A side of the largest housing finance company, which is vacating the nonbank space, we are probably the only mortgage focused player that has done at scale home loans retail LAP loans, loans to developers as well as other loans backed by real estate.

To put these numbers in perspective, in the last 8 years, we have disbursed over INR 1 lakh crores of home loans to over 4 lakh home loan borrowers with an average ticket size of approximately INR 25 lakhs. In the same period, we have disbursed about INR 44,000 crores of retail LAP loans to over 60,000 companies, small businesses at an average ticket size of just under INR 75 lakhs. And we've contributed to the country's housing stock by disbursing nearly INR 60,000 crores to developers, et cetera.

Thus, we see a unique opportunity for Indiabulls to emerge in this space, which is getting vacated and for the -- to achieve the same we are focusing on creating dedicated structures, separate structure, which will enable co-lending to capture the retail opportunity where on an incremental basis, we are generating 3-plus percent ROA. And as wholesale loans were historically through the cycle, and you're well aware now that we are at the positive end of the cycle. Through the negative end and through the entire cycle, we made a 5-plus percent ROA on the developer loans. So the endeavor is to create an organizational structure, which is giving us an opportunity to capture both of these opportunities, which is the 3% ROA retail opportunity and the 5% ROA wholesale opportunity.

By doing so successfully, we expect that our current ROE, which is under 10%, should double to mid-teens by fiscal '26. What is also helping is the fact that over the last 3 to 4 years as an outcome of various regulatory changes. The difference in regulation between housing finance companies and non-bank finance companies has largely been harmonized. So today, the company can work on a plan of reorganization without any financial or operational disadvantage.

As a result, consolidate its balance sheet into 1 large NBFC focused on asset-light retail origination engine, disbursing home loans and retail MSME loans. This reorganization will result in great consolidation, enhancement of capital levels, a reduction in gearing, all of which will give great comfort to our lenders and rating agencies. And I'll explain this point in a minute.

This will also lead to a simplified structure, reducing compliance requirements of multiple entities and improved transparency and governance standards, especially as we look to fold in all nonoperational subsidiaries of the company as well. All of this is obviously subject to the requisite approvals from shareholders, lenders regulators and the other statutory approvals. We are essentially taking advantage of the harmonization of the various regulations and ensuring we have NBFC structure, where we can do MSME and LAP loans, and [indiscernible] structure shall allow us to continue to work on the opportunity around the wholesale loans.

Now to just put this in perspective, they're lenders, local lenders, which is banks, which are our primary source of capital, look at lending to us. They do not look at consolidated numbers, they look at stand-alone numbers. Indiabulls Housing stand-alone capital adequacy is 23% with a Tier 1 of 18.6%. But once we go through this exercise of consolidation, then our capital adequacy rises to 31% with a Tier 1 of 26.6%. Obviously, this higher capital adequacy and Tier 1 is going to look more interesting and solid to any entity which is focused on lending around these numbers, which is essentially our banks. In parallel, we are also undertaking a rebranding exercise. The company over the last 3 years has walked a path of evolution of changing its governance framework.

And as we do the reorganization of our business and the entities involved, we won the name of the company and the entire corporate identity to resonate with our lenders, with our rating agencies, the various other stakeholders with our customers as well with our employees. And it should also reflect the mortgage-backed products, which are being offered by the company, especially as the company expands into the interline. Subject to requisite regulatory and statutory approvals, we expect the new brand to be unveiled in about 120 days.

Now getting on to the operational part, I'll go through the fiscal '23 and quarter 4 numbers. As I mentioned, our AUM and loan book has stabilized and marginally gone up. The balance sheet and the loan book have marginally gone up quarter-on-quarter. Our net interest income is standing at about INR 3,089 crores versus INR 2,752 crores for last year. This growth was supported mainly by income from the asset-light model and sale of investments. The profit after tax was marginally lower, about INR 50 crores lower, basically on the back of the increased OpEx that we did on people and branches of approximately INR 86 crores.

So even though year-on-year, the book declined, we were able to preserve our margins to make sure that our operating -- pre-provisioning operating profit came in strong at INR 2,270 crores and versus INR 2,019 crores. And as I explained, because our OpEx increased by 12% to INR 819 crores versus INR 733 crores, it had a marginal impact on our net profit for the full year. Retail disbursements were up from INR 3,000-odd crores last year to almost INR 8,000 crores this year. The net interest margin is at a strong 4% and the ROA has expanded to 1.4%. Asset quality has been stable, and I believe this is one of our biggest victories for fiscal '23 besides the scale up in the retail business.

The gross NPAs on a percentage basis are the lowest over the last 6 quarters, on absolute value basis are the lowest over the last 12 quarters at INR 1,918 crores. Net debt to equity is very, very nominal at 2.2x only. and the consolidated capital adequacy is at over 31%.

Now please refer to Slide 6 of the earnings presentation, which lays out our strategic focus areas going forward and the action points within each. Retail lending will continue to be our growth engine. Along with our banking partners, we will continue to grow the retail AUM in the asset-light model by originating under co-lending arrangements and also selling down loans. At the end of fiscal '23, the contribution of CLM, which is co-lending and loan sell-downs, increased to 34% of our AUM versus 10% in fiscal -- in quarter 4 fiscal '18.

We continue to sustain the 3% ROA through last year, even though we scaled up. And the high level -- high quality assets that we are originating will ensure sustainability of this business such that we can reach business volumes, which will generate an ROE in the mid-teens, 14% to 15% against the 7.7% where we are at right now, that's doubling the ROE. We will also, through fiscal '24 and '25 continue to expand our reach and continue to hire people.

We've added almost 15% to our workforce and 30% to our branch network last year, and we will continue with that exercise through fiscal '24 and '25 also. Thus cost to income through these 2 years will remain at 20% plus. But by fiscal '26, it should start coming down, which will help us in the ROE target that we are setting up about 15% for fiscal '26. The derisking of the legacy wholesale book would continue that book continues to run down. This book has performed extremely well for us and it has been a 5% ROA asset class for us. In the last 5-odd years, we've also built a pool of over INR 10,000 crores of nonperforming and written-off loans from the wholesale book.

The good thing is, in these last 5 years, we've already recovered INR 2,500 crores out of this INR 10,000 crore pool. And over the next 6 quarters, this is very, very important. Over the next 6 quarters, we are now confident that we will recover another INR 2,500 crores. So of the INR 10,000 crores, INR 2,500 crores is already recovered. And on the basis of the success, we are confident that in the next 6 quarters itself over the next 1.5 years, we will receive a recover another INR 2,500 crores.

There are other provisions and write-backs, which are expected totaling to a provisioning, implied provisioning cover of around INR 6,500 crores, which covered our gross NPAs 3.4x. And if you look at a combination of our Stage 2 and Stage 3 loans, then we have an implied provision of 88%. So not only is the capital adequacy very, very high at 31%, the provision coverage is much more than comfortable.

The ALM management is something -- the ALM liquidity management has been something which the company has been focused on. We've been talking about a rock solid balance sheet with adequate capital buffers and liquidity buffers, and we continue to proactively manage our ALM. The company has created a reserve fund to repay $270 million of ECBs, which are due later in August this year as well as $170 million of FCCBs assuming that they will be put on us due in fiscal '24 and '25.

We've already deposited 2 tranches amounting to INR 966 crores, which represents 50% of the total repayments for the ECBs and an initial tranche of INR 314 crores, which represents 25% of the repayment for the FCCBs. We will continue with this practice as we did, then we had to repay our dollar bonds last year, which we very successfully did. And this type of a buffer creation will continue as a practice for all such instruments where we are not allowed to prepay at our choice.

The other area of focus is the institutionalization process, which is an endless process in some ways. We are reaping the benefits of that. And now with the de-promoterization behind us, we would like to start moving forward on various other aspects of ESG. And continue to improve our various goals and scores and improved letter and spirit become a more social -- environmentally and socially responsible financial institution with higher standards of corporate governance.

If you can now please turn to Slide 7. We are sourcing now close to about over INR 800 crores of loans per month, which allowed us to disburse for the full year INR 7,800 crores. For this year, our goal is to disburse at least INR 12,000 crores. We will retain only 20% of these loans. And we are fairly confident that we should be able to grow this to INR 12,000 crores this year, given the fact that we've already over the last 1.5 years or so, disbursed over INR 11,053 crores through this model. We are fully focused on maintaining asset quality, right at the start, where we focus on loans with a higher CIBIL score, which is reflected in the 90 days past due of this pool, which is below 0.10%, which is 10 basis points.

We have standardized our policies processes, documentation, et cetera, across all of our partner banks and our eventual objective here is to have a co-lending marketplace tech platform, where we source loans which are made available seamlessly to all our partner banks on this platform. This will vastly improve efficiencies, which will result in higher ROAs and support the ROE goal that we have set for fiscal '26.

Now moving on to the ALM management, which is detailed on Slide 8. We carried liquidity, which is cash of approximately INR 4,500 crores. This includes sanction, but undrawn lines. As access to funding has eased, we have rationalized our on-balance sheet liquidity to minimize negative carry. The ALM is shown on a cumulative basis up to each bucket. We are positive across all buckets and will have a positive net cash of INR 6,833 crores at the end of the first year. Our detailed 10-year quarterly ALM is in the appendix slides on Slides 20 to 24. As per the RBI master direction for housing finance companies, we are mandated to maintain a liquidity coverage ratio of high-quality liquid assets as have been defined by the which even exclude bank fixed deposits against the desired 60%, we are at a comfortable 108%.

What's very interesting is that since September 2018, we have repaid debt and securitization liabilities of over INR 152,242 crores on a gross basis. and over INR 70,000 crores on a net basis. This is probably the largest debt repayment by our corporate entity in India across both financial and nonfinancial companies. And this, in some ways, is reflective of the quality of the portfolio we have built and also our approach to asset liability management.

We will continue to adopt this conservative approach towards ALM management. We do not assume any sort of refinance be it domestically or internationally, while we seek refinance, we do not assume so, and that is how we build our ALM. As we move forward, we will continue to maintain strong capital and liquidity buffers to provide both comfort as well as confidence to our bondholders. And this entire exercise or reorganization will provide greater capital buffers for our local bankers.

Now moving on to Slide 10 on asset quality. Our gross NPAs were at INR 1,918 crores, which translates to 2.86% and net NPAs at 1.9%. As I mentioned earlier, asset quality is steady.

Our gross NPAs on our lowest -- are the lowest they have been for 6 quarters. In absolute value terms, they are the lowest for 12 quarters. This is despite being -- becoming fully compliant last year with the RBI circular on NPA recognition based on daily DPD. And these NPAs will not be regularized unless all overdues are prepaid. At the end of March 23, our Stage 2 loan assets declined to 8% of our AUM compared to 31% of our AUM at the end of quarter 4 fiscal '22. Reduction in Stage 2 loans are due to strong repayment traction as well as on the backup -- back of the pickup in the real estate sector. Between the provisions we carry and our conservatively estimated recoveries over the next 3 years and some other releases, we carry included provisions of 12.1% of the loan book or INR 6,559 crores, which covers our gross NPAs 3.4x and our Stage 2 plus 3 loans by 88%.

So to quickly put all of this together, our retail asset light strategy has proven to be a game changer for us and has been able to create a nimble and high ROA retail ecosystem. We are back to being the third largest nonbank originator of retail mortgage loans in the country. and soon should go up to being the second largest. The wholesale book is showing strong repayment traction, which also aids recoveries from previously written off loans and presents a very interesting opportunity of partnering with foreign institutions to cater to the incremental requirement that this segment has of debt capital.

Between rundown in wholesale loans and growth in retail AUM and our strategic imperatives, it is appropriate that we are tracked on our retail disbursals and our CLM and sell-down in the overall liability mix. This is something that I requested last time also. And as I said, we are -- we have already expanded the contribution of this to 34%, up from 10% at the end of fiscal '18. We expect the ROA, which is currently at 1.4% to continue to expand in the direction of 3%, where which is where the flow of loans is happening. And as that happens over the course of the last -- next 2 to 3 years, by fiscal '23, the ROE will also expand to about 15%.

Now just to put some numbers in perspectives. Over the course of the last 5 years, our balance sheet which was at the end of fiscal '18 at INR 132,000 crores has run down by 43% to INR 57,000 crores, and that's the quantum of repayment that we have done. So as the balance sheet is now at about INR 75,000 crores, down from INR 132,000 crores. This has all happened by loans coming back and is thus reflective of the asset quality of our borrowers to whom we had given loans as of fiscal '18 and thereafter.

Loan AUM is down by INR 54,000 crores. Again by about 45%. But what's interesting is that despite the fact that we've done a INR 10,000 crore classification of loans as either NPAs or technical write-offs.

Our net worth has gone up 30% in the same period by over INR 4,000 crores from INR 13,400 crores to INR 17,316 crores. Even last year, from March '22 to March '23, the net worth has gone up by over INR 650 crores. While our balance sheet was still down by about INR 7,000 crores. So net-net, the important thing is that despite NPAs, which were down despite the cleanup that we have done and the recoveries, which have happened, we are still expecting further recoveries of INR 2,500 crores in the next 6 quarters. And this enhancement in network and this management of asset quality has happened in an environment where we've undergone 15 inspections by regulators and other statutory auditors since October 2019, we have been going through a concurrent auditor -- audit by our lenders for of every rupee in and out of the company.

We have fully adopted a much stricter NPA recognition and upgradation policy. We've gone through COVID. We've gone through a period of unprecedented liquidity squeeze for nonbanks as well as the real estate sector.

And despite that, not only have we increased our net worth by INR 4,000 crores, we continue to recover and recover handsomely. And year-on-year, we have grown our retail dispersals 2.5x. We've gone through a perfect storm much more than the most stringent stress test and believe now that fiscal '24 should be a period where we reorganize, rebrand and restart the growth journey such that we can get back to a respectable ROE over the course of the next 3 years. Through this period and even recently, our engagement with the rating agencies continues to remain positive. All of them have only recently revalidated our ratings.

To conclude, as we shift further and further towards co-lending on the retail engine scales up, we believe there's a large opportunity of doing co-lending on the wholesale side also, and we are creating dedicated vehicles for that. We believe Indiabulls Housing having done scaled up business of home loans as well as wholesale loans is a unique position amongst NBFCs to take advantage of the emerging opportunities. And thus, we should be able to grow our retail AUMs. We should be able to grow the assets under management of our [ AIFs ] and target a 3-plus percent ROA very shortly.

This was the update for the quarter. We are now open for questions.

[Operator]

[Operator Instructions] The first question is from the line of Craig Elliot from NWI.

[Craig Elliot, analyst]

Congratulations on the excellent results. Especially excited about the turning point that we've got past in this previous year, where growth for your new business more than makes up for the rundown of the legacy business. So congratulations, especially on that. My question has to do with Slide 10. The asset quality is excellent. You talked a lot about realizations from the old book. I see that we're now seeing about 0.1% of delinquency, 90-plus days. What do you think that number looks like through the entire cycle, higher or lower? Or how do you foresee things developing, please?

[Gagan Banga, executive]

Yes. So thanks, Craig, for the kind words. And to answer your question, the way that through the cycle, the retail asset typically performs is that in about 5 years from origination, home loans will settle at somewhere between 1% to 1.5% of the disbursed amount as NPAs and retail SME loans will be about 100 basis points higher to that. But these are 90 days past due numbers at peak and then the recovery start and eventually, the loss given default is only about 4 to 5 basis points since all of these loans are secured.

And the recovery process, it takes about 12 to 18 months after the loan gets classified as an NPA. So the what is 10 basis points, this is on a concurrent basis. If you look at it on a static basis, this will probably be closer to 20 basis points. This is a book with a blended average of about 12 to 14 months on our book. By the time it is 6 months on book, it will get to between 100 to 150 basis points. And then we will start the process of recovery on the static book, and we will start recovering.

The wholesale piece, where we're not incrementally doing a lot of business. We are doing only a little business through the [ AIFs ]. There typically the delinquencies will go much higher. They'll go as much as 7% to 8%. Loss given default will be about 1.5% to 2%. And -- but as I said, there's a pricing power is such that you still make about 5% ROA. The INR 10,000 crores of write-offs and NPAs that we took we expect that through the cycle, over the next farther 3 years or so, the total recovery will be between 6% to 60% to 70% of that. 25% has already happened. Over the next 6 quarters, 25% more will happen.

We got delayed by almost 3 years in the whole process because for 3 years, 2 years of COVID and then certain forbearances continued by the courts, et cetera. You could -- recovery proceedings practically came to stand still since the Repossession Act in India was put on in again. But it's been about 8 months that we are being able to again restart all the recovery proceedings, and we are already seeing a good traction on that. So these are broadly the numbers which will play out through the cycle. I hope I've answered your question.

[Operator]

The next question is from the line of Rishikesh Oza from RoboCapital.

[Rishikesh Oza, analyst]

Sir, my first question is regarding the loan book growth. So when exactly will we see the loan book regrowth premium stop at some point? And how can we grow the loan book in FY '24 and FY '25?

[Gagan Banga, executive]

So my sense is that by the third quarter of this fiscal year, the next 2 quarters, our retail disbursements will average at about a disbursal of about INR 800 crores to INR 900 crores a month. In the second half, it will average at about 1,300 crores to INR 1,400 crores a month. The moment it goes about INR 1,200 cores, INR 1,300 crores or higher per month, we will start regrowing net of the monies that come back from retail as well as on the wholesale side.

So for that to happen, unless we get some opportunity of being able to very profitably do some large-scale disbursement for which we can also raise the right kind of capital which would not come from banks, it has to come from other sources on the wholesale side. So apart from that, which is more opportunistic at this stage and not strategic over the last -- next 6 months. I would imagine that we will be flattish in the next 6 months from a sharp decline. We've kind of flattened out over the last 6 months. Over the next 6 months, we should remain flattish.

And in the second half, as we reach this versal numbers of about INR 1,200 crores, INR 1,300 crores a month, we should be able to start growing on a net basis. Now if the co-lending platform on the AIF side is to grow to the level that I personally feel that the opportunity is there, then this can happen much faster, perhaps by a quarter or so, not that much faster. It's something that we will start working on in terms of net disbursals in quarter 1 itself. We've done small business in fiscal '23. Whatever we did in fiscal '23, we will do as much as that in quarter 1, quarter 2, we will accelerate more. And then by quarter 3, some of the partnerships that we have stuck even on the wholesale side should start approving the loans that we are proposing to them.

The typical approval cycle by a fund for any wholesale type of a loan is around 2 months, and then the paperwork takes about 2 months. So we know exactly what we're going to disburse by June. We even know what we're going to be disbursing in July, August. So that pipeline is already ready. And it's on that basis that I'm giving you all of this guidance. So net-net, first half of the year, we should be flattish. Second half, we should be growing on a net basis. And once you do start doing that, then obviously, fiscal '25 will grow further.

[Rishikesh Oza, analyst]

Okay. Sir, my second question is with regards to dividends. So can you like give an update on dividends? Can we like expect dividends in this financial year?

[Gagan Banga, executive]

So now even for -- we are now technically able to give dividends even for fiscal '23. But it's a matter that has to be -- first, there's a technical qualification. Then the matter has to be taken up by the Board and subsequently by the shareholders for a final dividend to be declared in the AGM. So the only update I can give to you is last year, we were not technically enabled since we had dipped into the reserves. This year also, we had dipped into the reserve, but we are still technically enabled given the various calculations. But the decision has to be taken by the Board by -- and subsequently by the shareholders. So we will discuss this in the Board. And if the Board so approves, then it will be put up to shareholders for final dividend.

[Operator]

The next question is from the line of Elesh Gopani from Gopani Securities and Investment Pvt. Ltd.

[Elesh Gopani, analyst]

I want to ask the question this reorganization. Can we not induct a big financial partner in the business fast and since there are no promoters now. So can we not search a good promoter and enhance the business?

[Gagan Banga, executive]

Yes. So the whole idea of the reorganization is to be able to have specific entities, one which is pursuing a retail business and another which is pursuing the wholesale business. We would need strong financial partners on the wholesale side. On the retail side, we already have financial partnerships in terms of banks which are providing us the capital on the co-lending side. And it's a question of putting one foot in front of the other. There is we on a listed company. So we have to make our investments in people and branches in a calibrated manner.

We can only allow our OpEx to go up by so much. it's ultimately a human-based business and human being stake, certain time to understand policies, processes to become productive. So all of those lags one has to bear. So it's not that I can make 5,000 people, 10,000 people and the business will double from tomorrow morning. It has to be done in a calibrated manner. So some of these partnerships are in play for the wholesale side. On the retail side, they are already in play. As far as equity partnerships are concerned, if you have a structure which is very dedicated and focused. You obviously become interesting to people who are looking at a specific opportunity.

Some people are more convinced about the retail opportunity in India, some others around the wholesale opportunity in India. So we have created a structure. We've also built a track record. We have become without a promoter. Management team does not feel it needs a promoter. Financial partnerships is something that we will be equity or debt. We are certainly open for. We -- if there is anything which is more specific, we will obviously inform you. But we are obviously taking feedback from the various investors who already either own us or have in the past owned us. And we are doing all of this reorganization. This is the feedback subset, the structure becomes more investable.

[Operator]

[Operator Instructions] The next question is from the line of Kayur Asher, PNB MetLife.

[Kayur Asher, analyst]

I just wanted to understand if you could talk about the progress on the liquidation of the wholesale book. Where are we on that front time? If you could quantify the size of the residual wholesale going? And what is the target that we are setting for the coming quarters?

[Gagan Banga, executive]

So the liquidation process, which we started, I think, more or less is now done. We don't have to liquidate a lot another maybe INR 4,000 crores to INR 5,000 crores on a net basis is something that we will look forward to doing through the course of this year. But at the same point in time, that kind of disbursal, we would like to see happening from the AIFs. And through the second half or the second and the third quarter itself, should materially produce some of these numbers.

So I think, as I mentioned a short while back, there is no gross reduction in anything which is happening. We have to just make sure that the correct pool of capital is back on the right asset. And what is very clear for me is that debt capital can't back wholesale lending done by the company. It has to be done in a more specific and dedicated vehicle, which we have created. We've scaled up. We've generated returns there and so on. So we are confident that, that track record will -- is getting us partners, will continue to get us partners.

We've also done transactions of over INR 15,000 crores to INR 16,000 crores with various global funds over the last 3 years, and they have seen the success of those portfolios. So there is that additional bit of traction, which comes by people lending out money and receiving their monies back. So my sense is, the numbers are not going to be very significant going forward. There could be 1 or 2 chunky loan repayments, which come back. But aside of that, it's more or less normalized now and which should allow as soon as our retail disbursement scale up by a rather INR 300 cores to INR 400 crores, a net growth to start happening.

[Operator]

We'll take the last question from the line of Kanwaljit Singh from Balaji Fin Investment.

[Kanwaljit Singh, analyst]

My question is regarding formed recovery that we have made on the wholesale book in the current quarter? And is there anything -- anything to be recovered from the previous promoter?

[Gagan Banga, executive]

We have never lent to the previous promoter. We have no debt issuances to the promoter or any of his companies in which he is a promoter. The promoter incidentally, the erstwhile promoter incidentally till the time that he was a promoter to the best of my knowledge, anyways, did not have any debt. As far as recoveries are concerned, I think last year, we recovered about INR 600 crores in the years prior. In the 3 years prior to that, we recovered about INR 2,000 crores. And as I mentioned, in the next 6 quarters, we expect to recover another INR 2,500 crores fairly steadily over each quarter. So about INR 400 crores to INR 500 crores per quarter, including quarter 1 is the expected recovery that we hope to see.

Yes. Thank you, everyone, for attending this call, and thank you for your support as is evident, we are doing fairly well. And now step-by-step, we are also moving in a direction where we can start to materially enhance on our franchise. So as we do that, we'll be in touch and look forward to seeing you next quarter. Thank you.

[Operator]

Thank you very much. Ladies and gentlemen, on behalf of Indiabulls Housing Finance, that concludes this conference. Thank you all for joining us, and you may now disconnect your lines.