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LIC Housing Finance Ltd
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Good morning, everybody, and welcome to the Q1 FY '20 Earnings Conference Call of LIC Housing Finance. Representing LIC Housing Finance, we have with us newly appointed Managing Director and CEO, Mr. Siddhartha Mohanty; and Mr. Sudipto Sil, Chief Financial Officer, to discuss the Q1 FY '20 results. I now request Mr. Mohanty to take us through the key financial highlights for the quarter, post which we will have the Q&A session. Over to you, sir.
Good afternoon, and welcome to the first earning call of LIC Housing Finance Limited. As you would be knowing, LICHFL declared its Q1 FY '20 results on Saturday. This is my first interaction with the analysts and the investors as the MD and the CEO of LICHFL after having taken over on 1st August, 2019. Revenue from operations, INR 4,757 crores as against INR 4,005 crores for the corresponding quarter of the previous year with a growth of 19%. Outstanding loan portfolio stands at INR 1,97,768 crores as against INR 1,69,866 crores as of 30th June of 2018, reflecting a growth of 16%, out of which individual loan portfolio stood at INR 1,84,155 crores as against INR 1,61,467 crores, up by 14%. Within the individual loan portfolio, home loan portfolio stood at INR 1,49,341 crores as against INR 1,32,901 crores, with a growth of 12.4%. Net interest income stands at INR 1,154 crores as against INR 980 crores, up by 18%. Disbursements during the quarter were at INR 10,261 crores as against INR 9,594 crores for the same period in the previous year, a growth of 7%. Disbursements in the home loan segment clocked a growth of 8% during the quarter and stood at INR 7,871 crores. Disbursement in the project loan construction finance were lower at INR 829 crores as against INR 889 crores. Net interest margins for this quarter were at 2.35% as against 2.32% for Q1 FY '19. Profit before tax clocked a growth of 7% to INR 840.89 crores from INR 788.40 crores. Profit after tax for the quarter stood at INR 610.68 crores as against INR 567.94 crores, a growth of 8%. The environment during the first quarter of financial year 2019/'20 continued to be quite challenging in terms of overall demand and external factors. However, considering this situation, the company performed fairly on the business front, recording an overall disbursement of INR 10,261 crores, recording a growth of 7%. Company recorded a growth of 8% in the individual home loans from INR 7,260 crores to INR 7,871 crores. Amongst the regions, the Central, South Central, Southeastern and Western regions registered good growth. On the affordable housing front, under PMAY CLSS scheme, the company continued to perform quite well. For the quarter under review, the company disbursed 10,073 accounts totaling INR 2,021 crores under these schemes, accounting for nearly 25% of the retail disbursement in volume terms and 21% in value terms and has received a subsidy of INR 219 crores for the beneficiaries. This will be our focus area for the current year. This year, we have opened 9 more marketing offices in Tier 2, Tier 3 cities like Shahdol, Guna, Guwahati, Chittoor, Jadcherla and others with a clear focus on affordable housing business. This year's Union Budget has laid a lot of focus on affordable housing segment through announcement of several initiatives like additional deduction of 1.5 lakh on interest paid for homes -- home loans for properties up to 45 lakhs. We believe this is a very good initiative taken by the government towards its Housing For All by 2022 program. As we are firmly entrenched in this segment, we are very confident of playing a leading role in this area. Considering the overall market conditions, we have done lower disbursement in the project loans construction finance, which were INR 829 crores as against INR 889 crores. On the portfolio growth front, the total portfolio recorded a stable and a consistent growth of 16%. Growth in the individual home loan segment clocked the multi-quarter high of 12.4%. Pursuant to the introduction of Indian Accounting Standard, companies are required to report expected credit loss, ECL, on their loan assets and the provisions thereon. In terms of asset quality, there has been an increase in Stage 3 exposure at default, which has increased by 44 basis points from March 2019; that is 1.54% to 1.98%. On the project loan construction finance portfolio, the increase was attributable mainly to a couple of accounts. We have adopted a multipronged strategy to address the NPA situation, including an account-by-account scrutiny at each level, including at the corporate office level. Legal action has also been initiated in these cases. In most of these cases, the delinquency is due to slower sales, due to which installment payments are getting delayed resulting in transition from Stage 1 to Stage 2 and Stage 2 to Stage 3. However, we take minimum 1.5% security cover for construction finance. The value of underlying security is significantly higher than our loan exposure since many of the projects are complete, which gives us confidence of recovery. We are according the highest priority to this area across the company. The top 8 project loan NPA account, accounts for 65% of the total NPAs in project loan, and every effort is underway to resolve this. On the cost of fund side, margins have remained largely stable year-on-year. We have witnessed a reduction in incremental cost of funds by 19 basis points from 8.43% to 8.24%. The net interest income growth has been nearly 18% higher than our portfolio growth. The funding environment and the liquidity conditions remain favorable. During the quarter under review, we have raised funds through NCDs, bank loans, NHB refinance and other instruments, including public deposits. Looking at the overall interest rate scenario, we expect some reduction in the incremental cost of funds. With this brief introduction, I would like to invite your queries. Thank you.
[Operator Instructions] The first question is from the line of Mohit Mangal from CRISIL.
I have quite a couple of questions. The first is, can you tell about the incremental yield? And also, on your presentation, the Tier 1 and Tier 2s of March '19? So can you provide the data as of June 2019?
Tier 1, Tier 2. The incremental yield 9.55% non-annualized. And the...
Incremental cost is 8.24%.
8.24%.
8.24%.
That's upon the -- yes.
That is annualized.
Annualized.
Okay. And regarding the Tier 1 and Tier 2?
The Tier 1 and Tier 2, by and large, will be in the same range. We will publish it once it is approved by the regulator. It has to be first provided to the regulator. Only then it will be placed on the presentation, but it will be, by and large, in the same levels.
Sure. Sure, sir. All right. Sir, just last one question regarding the provision, the overall provisions, including the standard assets. Some figure on that?
19...
19...
INR 1,919 crores total provision we have made, including provision for standard also.
The next question is from the line of Pranay Rajani from B&K Securities.
Just a few data-keeping points. Can you please…
Mr. Rajani, sorry to interrupt you. You are not audible. Can you please ensure you are audible?
Am I audible now?
Yes, yes.
Yes. Sir, just a few data-keeping points. Can you please provide a gross NPA and net NPA numbers, also along with the bifurcation for individual and developer gross NPA percent?
Actually, gross NPA, retail is 1.25% and the total is 1.98%.
Retail is?
Retail is 1.25%, and the overall total NPA is 1.98%, including projects.
Okay. On just for the developer front?
Developer, it will be 10% plus. It will be around the 10.5%, 11%.
[Operator Instructions] The next question is from the line of Hardik Shah from Max Life Insurance.
Sir, a couple of questions. What is the gearing for the current period? And what is the peak gearing you'd like to operate at?
Yes. This is Sudipto, Hardik. The gearing as of now is around 10.5x right now and will probably remain at around -- I will -- at present, around ballpark this range.
Okay. And any plans for capital raise?
That -- no, we have seen that NHB circular. At appropriate time, it will be informed when the Board takes their decision.
Okay. And sir, there is a spike in the NPA for the builder book. It was around 7% in Q4, which is now 10%. So are there some large slippages?
Yes. Actually, what happened, only 2, 3 accounts, which we still are in discussion, they were standard up to March, but somehow, they slipped into NPA. So that's why the amount is a bit high there. So it has gone up. And if you look at our builder portfolio, it is just 7% of our total book. 7% of that is very negligible considering the total volume of our business size.
As a percent of net worth, it becomes significant. That's why.
Yes. Yes. But that is there.
Yes. Right, sir. And going forward, any peak number at which you'll operate for the builder book?
Yes. Builder book, actually, now our focus is on affordable housing. But the builder book, we are open to good quality projects. We're not totally stopping. We are there. And particularly, we'll promote those projects, which cater to affordable housing. That will be our focus area.
The next question is from the line of Kunal Shah from Edelweiss Financial Service.
Yes. So again, coming on to this delinquencies in the corporate developer books. If you can give more color in terms of the location and which was the highest account and this is like specific to 1 project. So whether this is like more kind of a project loan. So maybe more clarity in terms of where this INR 600 crores, INR 700-odd crores came in from.
Actually, it is not confined to any strategic region or area. It is spread. And builder, actually, as per new norms, even if one project -- suppose some builder has taken 2 projects, loan on 2 projects, one project is standard but if other is not standard, then also, you have to show that as NPA. So that has also affected. And it is not in its specificity.
Okay. And what would be the largest account? So this constitutes how many accounts? Is it like 3, 4, 2?
This time, it is 3 accounts, I think.
Okay. And largest of this would be how much? Sir, if we can just give...
I'd say INR 200 crores.
Okay. Because total is almost, I would say, INR 700 crores, INR 900 crores to INR 1,600 crores. So total is INR 700 crores. So I'm not sure if it is like 3 accounts. What is the broader split up?
Mainly 3 accounts. They actually account for this INR 600 crores, INR 700 crores.
Okay. So 3 accounts are into INR 600 crores, INR 700 crores.
Yes.
Okay. And in terms of the slippage, so there is no recovery at all in the...
No. Recovery, I -- that I'll tell you, you'll also be glad to know. In the last quarter, we recovered out of NPA -- from March NPA, we recovered some INR 377 crores. So we could make them -- March quarter, whatever NPA was there. Last quarter, our recovery, June quarter, INR 377 crores we recovered. So from...
Sir, is it individual or non-individual?
Retail, retail.
Yes, retail. Okay. Okay.
But despite that recovery, if you see total project and retail, some additions are there. So that's why total NPA has gone up. Efforts are there. Recovery is there.
So around the nonindividual, there is no recovery during the quarter, no?
In non-individual, there is marginal recovery. There is recovery. But even they are paying. Those who were accounted as NPA, they are also paying. But they're not paying full so they are categorized as NPA. And a delay is there, yes.
Okay. Yes. Sir, just maybe in terms of understanding this INR 600 crores, INR 700 crores kind of an increase, this is the exposure to the entire -- maybe the group. So -- but in terms of the project...
No, not one group. Different, yes.
Yes. But if we want to look at it in terms of the projects purely, wherein maybe there would be some delay, what would be the quantum? So I think maybe because of the norm, you have to consider the overall exposure to that particular entity as GNPL, but stress would still be restricted or delinquency would still be there in few accounts. So if we have to quantify that, how much would that be?
Yes. Yes, Kunal, see, actually, the ones that our MD just referred to, which are right now paying, but we have considered them additionally, that will account for around INR 150-odd crores.
Okay, INR 150-odd crores.
Yes. Yes. Which is at present performing and standard assets, but because of the new norms, we have considered them as NPA.
Yes. So out of INR 700 crores increase, INR 150 crores is due to reclassification.
Yes. Yes. Correct.
And INR 550 crores is the actual delay?
Correct, correct.
[Operator Instructions]
Yes. It's a related one on the NPL. So just on the individual side also, if you look at it, there is increase over last 4, 5 quarters from 0.4% to 1.26%. And now it's at the highest level, maybe, I think, 1.26%. So what are we seeing away? Is it largely LAP, individual and why we are seeing this kind of stress? Because I think across the industry, it's been sustained quite well. So I want to understand even on the individual side the higher NPLs.
No. Actually, in the individual, it is total, not only compared to 1 segment within individual, but it is individual as well as LAP. And all these are taken together. It does amount to 1.26%. And that increase, also we are controlling. That is now contained because we are expanding in the individual segment largely, particularly affordable housing. So that will also be controlled.
No, sir, increase in LAP or in retail?
In both. Both taken together.
The next question is from the line of Dhaval Gada from DSP Mutual Fund.
Sir, just if you could start by giving the GNPA for the industrial home loan segment. What is that number for the quarter and same period last year?
Individual, actually, this is 1.26%, and the gross...
Core home loan.
Core home loan, that is INR 2,307 crores.
Retail book rates.
Retail, retail. The individual retail.
Okay. And what are those numbers, sir, in 1Q '19, yes?
Last -- Q1 '18, Q1 '18, you mean to say, no?
No, no. Same period last year, sir.
Same period, it was INR 1,295.47 crores. As against that, it is now INR 2,307 crores.
Sir, sorry, just to clarify. This 1.25% is for individual?
Individual. Individual, individual total. Yes, yes, yes.
I'm asking for only home loan. What is the number, sir?
Home loan will be 1.03.
Sir, last quarter, 0.9%. If 0.9% was the number last quarter, what is this number this quarter?
Now 1.02%.
1.02%.
Only individual home loan. You mean to say that, no? Individual home loan, 1.02%.
And the same number last year was how much? June quarter last year was how much?
0.69%.
0.69%. 0.69%.
Okay. So basically, this quarter, actually LAP NPAs are stable. It's the home loan -- yes...
Slightly, slightly. Yes.
Okay. And the second question is, sir, on the pricing environment. I mean you mentioned that you expect some reduction in the funding cost. What -- similar commentary around pricing. So just overall, how do you see pricing and spreads going forward?
I think pricing will stabilize if you look into overall environment and the easing of liquidity situation. I expect price to be stable to positive.
Do you expect the spreads to remain around this level and expand from here? Or...
Spreads will be, I think, stable -- stable to positive. That will be good.
Okay. And just lastly, on recoveries, some of the development portfolio, any number or time line that you have in mind by when you expect resolution on these developer NPAs?
Actually, we are always after the developers to recover as early as possible, but at least in 2 to 3 quarters' time may be taken to resolve business developers' issues.
Okay. And sir, what is our absolute net -- the net NPA ratio? Sorry.
1.4% net.
Sorry, I missed that, sir. How much?
1.4%.
Okay. And the same number last year was how much?
Last year, the same number was -- net NPA, it was 1 point...
It was 0.8% something.
0.80%. 0.80%. 1 point -- 0.1% isn't it -- 0.80%.
The next question is from the line of Digant Haria from Antique Stockbrocking Limited.
Sir, right now, in your commentary, you said that we were -- now going ahead, the focus will be on affordable housing, and we would probably be doing less of LAP and developer loans. So in that context, what sort of margin should we expect in the upcoming quarters? Because at least the public sector banks are still quite aggressive on the housing -- that normal individual home loan sector.
Yes, as far as margin outlook is concerned, what our MD just mentioned a few minutes back is that the spreads as well as margins, the outlook is stable to slightly positive. In terms affordable housing, there is no dilution in terms of margins. It's basically a volume play. It's basically a volume play.
Volume. Volume.
But I mean, having said that, because the size -- the ticket size of these accounts are much, much smaller, the risk gets dispersed.
Okay. Okay. Okay. And last question, just repeat of what Dhaval asked before, that LAP -- NPA in the LAP segment would be 2.03%, right? Because based on the...
Approximately, yes.
Approximately, 2% -- 2% plus.
The next question is from the line of Umang Shah from HSBC.
I just have 2 questions. One is a data point. I missed the data given in the opening remarks about the volume and the value proportion of affordable housing in the incremental business.
Volume-wise, actually, current year, current year, so far, we have disbursed 10,073 loans under PMAY and amounting to INR 2,021 crores, and which contributes to 24% of our total disbursement in terms of volume and at 21% in terms of value.
Okay. And this is for Q1, right?
For Q1 only.
Okay, okay. And my second question was related to the ECL model. Basically, what is the database that we follow? I mean it's -- the base data is for what vintage?
Yes. It's 20 quarters. 20 quarters.
Yes.
20 quarters. And rolling forward every quarter?
Yes, yes.
Yes.
It's a rolling model.
The next question is from the line of Jignesh Shial from Emkay Global Financial Service.
These are quick data-keeping questions only. So what is our absolute quantum of gross NPA for the quarter? And what was [indiscernible] -- yes. Sorry.
3,887.17 crore.
And what was the same amount last year, same quarter, Q1 FY '19?
2,036.32 quarter -- 2,036.32 crore.
And what will be your net NPA number for this quarter, 1.98? Is it correct?
Net NPA is not...
Gross is 1.98.
That is gross NPA, 1.98.
Okay. And the net is 1.40?
Net is 1.4.
1.40.
And gross NPAs individual, just reconfirming it, is 2,307 crores.
Yes.
And net -- sorry. And corporate is 1,580?
Balance.
Balance, yes.
Balance. Perfect. That's useful.
The next question is from the line of Darpin Shah from HDFC Securities.
Did I hear correct that 8 accounts in developer loans form 68 -- 65% of the NPA?
Yes, yes, that's correct.
Yes. So can you just also highlight -- can you highlight, what are the recovery processes we have started in these accounts and until what level we have reached? And the second is how much provision coverage we are carrying in these developer loan accounts?
Actually, all the legal action, we have initiated. Simultaneously, there is a discussion also, negotiation going on. SARFAESI action already initiated and...
In all the accounts? I mean the top 7, 8 accounts?
Recently, we are yet to initiate. This quarter, whatever has done, 3, 4 accounts. That, we have to initiate, but all others, we have already initiated. Then, negotiation is also going on because some accounts are still paying. They are not paying full amount. Partial payment continues, so that demonstrates that -- their positive approach, the intention to pay. So that's why they are paying.
But then can we see a resolution in the next quarter or 2 or...
I think, 2, 3 quarters, some accounts will be resolved.
How much can we expect?
That exactly is very difficult because of the way we are interacting and are getting response. I am hopeful, at least by year-end, some accounts will come out of NPA.
Okay. And how much is the coverage we are having in these accounts in the developer book, the provision coverage?
Yes. Total coverage in the -- I mean, recently, whatever provisions have been made have been made mostly on account of the delinquencies in the builder accounts, but overall, if you want the coverage, then the provision will be approximately -- well, putting together all the standard as well as the...
And the nonstandard.
Standard as well as the nonstandard assets, total provisions on the book will be 1,900 crores. Specifically, for the builder loans, it will be approximately around 490 crores, a little less than 500 crores.
And that includes standard?
Yes.
Yes.
But excluding standard asset provision, how much it will be?
You knock off 95 crores, so it will be around 400 crores.
The next question is from the line of Abhijit Tibrewal from ICICI Securities.
Sir, if I look at your cost of borrowings, I see cost of borrowings have come down for NCDs, CPs, NHB, but our cost of borrowings have not come down for the bank term loan. Is there anything that we should know or anything that you'd like to comment?
Yes. You certainly will be aware of it, that the rate of transmission as far as the bank MCLRs are concerned, is happening but happening in small bps, 5 basis points or so. So -- but another thing which you would have certainly noted, I'm sure, is that the overall exposure, that is the borrowings from our bank loans has come down between March and June. And that is -- the reason of that is because the cost of funds from that source is more expensive. So we have cut down the exposure there.
Okay. All right. And sir, out of the total credit cost of 353 crores in the quarter, what was the quantum of write-offs that we took?
No write-offs.
No write-off.
No write-offs.
No write-offs.
Okay. And the slippages in the developer or project finances, is that number correct, the 600 crores, 700 crores of the number that we are talking about? Were they the slippages in developer or project finance in Q1?
Yes.
Okay. And sir, just one last question. If I heard it right, you talked about those 8 projects which account for 65% of the total NPAs in project finance. I mean, geographically, how are -- where are they exactly in this quarter?
That is spread across.
Spread across?
Yes.
Yes, yes, yes.
Nothing specific to, let's say...
Nothing specific, yes.
Delhi, NCR or Mumbai region?
No, no, no.
No, no, no.
The next question is from the line of Bunty Chawla from B&K Securities.
All my questions are answered. Just one data-keeping point, if you can share: Total provision, you said 1,900 crores on the -- with respect to ECL provisioning. So can you share the same number with respect to NHB guidelines?
The NHB guidelines, it is 1,912 crores.
Okay, not much difference between the 2.
Yes. There will be even more.
Yes.
The next question is from the line of [ Sagar Shah ] from Alphaline Wealth Advisors.
My first question was regarding to your GNPL outlook actually. And so you have done 1,900 crores provisions as per ECL provisions, so what is your outlook on the remaining book of ours actually and looking at the current environment? My first question was that.
What exactly do you want to know? Sorry.
Of your remaining book, what is your outlook regarding the same actually? Are you seeing the remaining book as standard? Or are you seeing so -- are you expecting some slippages in the coming quarters from that book?
Actually, we have -- our recovery mechanism, we have strengthened it. Account-wise, the account, we are now strictly monitoring, but we do not have control on other external factors. What we see, at least if we are able to stabilize because there is a recovery. As I told, the first quarter, we recovered some 377 crores, but the slippage is a little more. But in the remaining quarters, our focus will be more on recovery, asset quality, all those things will be there. So I don't think much increase. At least, if I am able to stabilize it or reduce it, that will be -- I think, will be a good performance.
Okay. Okay. And looking at [indiscernible], you told that our cost of funds, you expect it to decrease actually, looking at the current interest rate environment. So something like are we going to pass on the rates for the incremental loans that we are going to give going ahead? And we are -- will we expect a pressure on the NIMs going ahead?
You see actually, now our one loan scheme, we have floated that is up to 31st August at 8.4% interest rate. We are now giving a new home loan at 8.4%. So that means we are also passing on to new customers whatever benefit is there, interest benefit that is in there.
Okay. So sir, do we expect a pressure on our spreads or NIMs going ahead, or will we maintain the same in the coming quarters?
So I think the pressure -- in fact, if you look at the funding environment, it has become quite comfortable. There is a significant amount of liquidity which has come into the system. And even today also, the tenure has come down quite a bit. So there is no pressure as far as the funding side is concerned, at this point in time.
The next question is from the line of Adarsh from Nomura.
On your Stage 2 assets, that number is increasing. So I just wanted some color on what's happening there and more importantly, the composition there, right? What part of that -- can you break that up between retail and corporate? And what's the provisioning policy? Because your provisioning was very low. The book keeps growing in terms -- in percentage terms as well. So what's the -- how do we look at the coverage on the Stage 2 book?
Yes.
So yes. As far as the overall -- in the opening remarks, what we mentioned is that there is certainly a delay which is happening, due to which there is a transition from Stage 2 to Stage 3 as well as from Stage 1 to Stage 2. So that is something which is there. As far as the breakdown of the Stage 2 is concerned, on the retail side it is around a little less than 4.5. On the non-retail segment it is around 6, slightly more than 6. So that is how it stacks up in terms of the Stage 2 in these 2 areas. As regards the provisioning cover is concerned, the provisioning is derived out of an ECL model. And we have also kept in mind the provisioning required as per the NHB. And we have actually done slightly more than what was required, as far as the NHB provisioning requirement was because that was the number which came out of the ECL, which is basically a model which takes into consideration the potential of, probability of default and the loss-given default. And whenever there is a deterioration in the collections or a delinquency string, it actually captures that into the provisioning requirement. So that is actually taken care much, much more dynamically in the ECL model.
Sir, the only problem with that, you have 20 quarters of data, as you roll for 2, 3, 4 more quarters and you had problems -- you didn't have problems for the first 3 years of your ECL model data, and last 2 years is the only where the NPAs have gone up. As you roll forward, the experience or at least the NPA that shows up now will reflect or become a larger part of your ECL model, which would imply that your slippage rate from Stage 2 to Stage 3 and Stage 1 to Stage 2 will also increase. I'm just wondering if -- why will this not happen and hence require larger ECL provisioning as we go in the next like 2, 3, 4 quarters.
That is exactly what has happened this quarter itself...
That is quite real on...
That the quarter -- the ECL model factors the probability and the loss-given default. Mind you it is all a predictive model. So these things, what you've just articulated, your concerns -- the concerns that you have articulated, is already factored into the ECL model which has given this number.
Okay and understood. Just one more thing: Like somebody asked on resolutions, right? So these 5 accounts. So what -- like you know broadly what the security cover is now and -- on these 5 large accounts. And we've been talking about some recoveries for the last 2, 3 years on NPAs that happened about 1 year, 1.5 years back. So what's the status on those?
Yes. As far as the security cover is concerned, the minimum security cover taken is 1.5x. So the LTV accordingly will be in the -- between average -- if you take off all -- on all these cases, the LTV will be in a range between 30 -- 40 to 50. So the security cover will be almost 2x on an average because there's -- some repayment has also happened on the exposures that they had taken initially. So that is as far as the LTV and the security cover is concerned, without considering any appreciation in the land value from a point-to-point basis. So that is irrespective of that. So if there is an underlying increase in the value of land between -- on a point-to-point basis, that has not been factored in. So that is one thing. As far as the recovery is concerned, you will recollect, last year, in first quarter, we had made a recovery where the amount recovered was almost 70% higher than the exposure taken. So it takes time, but because the value, underlying value, of the security is quite good, in our view. And the legislative process obviously, whatever the legal processes taken, will take its time, but we are still confident that we will not undertake any losses on these accounts, on these exposures.
And last question, Sudipto, is on what constitutes Stage 2? Is it like any overdue; or overdue beyond 60 days, 30 days? What...
No, no, no. It is beyond 30 days.
Yes, beyond 30.
Beyond 30.
So anything beyond 30. So 30 to 90 is...
Yes. We are -- very strictly, we have enforced that. And very strictly, we have enforced -- there is a delay. There is no doubt about that, that payment delays are there. In fact, there are accounts which are coming to us as -- the repayments which are coming to us after 30 days, but we have very strictly considered them as Stage 2. And we have disclosed them also.
The next question is from the line of Nilang Mehta from HSBC Global.
Sir, can you tell me the new slippages which have happened on the developer side? When was -- what is the vintage of this loan? When were they given, which year?
3 years plus; 3 to 4 years. It is not a first-year quick mortality, but it has run for more than 3 years. Three years, 4 years in some cases.
And these are [ about initial ] project loans, right?
[indiscernible] -- yes?
Yes, these are project loans, right, sir?
Project loans. And then projects are almost complete, but some sales are not happening. So that's why there is some problem.
Okay. So the -- these lower -- so the project is complete, and because of sales traction not being there, there are cash flow issues. And that's why it's become an NPA.
Yes, right, yes, yes, yes.
Okay. So any of your loans which are stuck right now where projects are not progressing because of cash flows not being available on sales or from financing side? Is that -- or all the NPAs are mostly completed projects.
No.
No such cases. Actually, mostly it is affected because of a slow sale.
[Operator Instructions] The next question is from the line of Bhaskar Basu from Jefferies Group.
Yes. Just one question, a follow-up on this developer loan. You mentioned that 2 or 3 accounts which have slipped during the quarter. And obviously, 150 crore is projects which are projects which are still paying. But within the projects which have slipped, where are these located? And between the 3, which of these -- what will be the stage of completion? I heard you mention that most of them are complete, but some more color would be really helpful.
Actually, these are not confined to 1 region. These are spread. And almost 80%, 90% -- some projects are almost complete. Sales are not happening. 80%, 90%, sales have happened, but still there are inventories. And other places, more than 80% completion is there, in some projects.
So just to understand. These are multiple loans on multiple projects to a particular developer. Is that what you mean when you're saying that these are in different locations? Because...
These are different builders, different builders and different projects.
But if there are 2, 3 accounts, which mean that 2, 3 builders which are involved...
Yes, 2, 3 projects in different locations.
Yes, yes.
Yes, so which -- where will these 3 locations be?
That we shouldn't like to do...
The top 10 cities.
Big cities.
Okay. Okay. Fair. Just one more question, on the incremental yield, if you can break it down between home loan and developer. Housekeeping question...
Yes, yes. For the home loan, it is 9.97%.
That is [ 10 ]...
I'm telling you on the annualized business, Bhaskar, okay, yes?
Yes, 9.9, builder...
9.97% is for the home loan piece. For the other that -- the noncore portion, that is ex of home loan in the retail segment, that is 11.4%. And...
Okay. And the developer...
13 point...
Around 13%.
13.52%, to be more precise.
The next question is from the line of Hardik Shah from Max Life Insurance.
Sir, just a follow-up question. What will be the ALM...
Sorry to interrupt you, but please speak a bit louder, Mr. Shah?
Yes. What is the ALM position in the "less than 1 year" bucket?
Yes, sorry. We're not able to understand, Hardik. Can you please speak up a little loudly?
What is the ALM position in the "less than 1 year" bucket?
Yes. "Less than 1 year" bucket, the -- it is within the NHB norms of 15%.
But what would the mismatch be?
Mismatch, around 13% or so, 13%. Within 15%, that is the maximum that the NHB allows. We have 13%...
Okay. But how would shorter buckets look? And whether...
Actually 1 to -- 0 to 1 year only.
0 to...
Are you asking overall, or 0 to 1 year?
0 to 1 year.
Right. 0 to 1 year is minus 13. Overall, it is positive by 50.3%.
Okay, sir. And sir, out of the builder loans, how many will be to the subvention schemes?
No, not this...
No, we don't -- no, none of them.
The next question is from the line of Dhaval Gada from DSP Mutual Fund.
Yes. Sudipto, just one question related to this individual home loan of -- NPA of about 1% plus. Would it be like the highest since 2010? I just wanted to check that.
Since 2000?
'10. The individual home loan, I'm saying, the...
No, no. I think 2011 or 2012 was a higher percent, yes. Slightly higher.
Okay. And any sort of corrective action that we are taking on this segment to address? Or I mean any thoughts around this level of NPAs?
So obviously, to...
We have actually formed a task force to monitor each individual loan account. And our -- down the line, at area office level, back office level, we are closely monitoring. The momentum has today -- before also due date, the notice goes, SMS goes to the customers, reminding them that the due date is there. They should pay. And immediately, if they fail, next day, again, message goes out. People also go on to contact them. So there is always a pressure. So I don't think the individual loan segment, that will, I mean, increase with their -- in default.
Next question is from the line of Mohit Surana from CLSA.
Sir, most of my questions are answered. Just...
Mohit, sorry to interrupt you. Please speak a bit louder.
Yes, yes. I just wanted to get your thoughts on the growth going forward.
Actually, for the current year, looking to total environment, we are very hopeful. I see 15% growth, at least 15% in the current year in our home loan segment.
Next question is from the line of Aakash Dattani from HDFC Securities.
All my questions have been answered.
Thank you.
Next question is from the line of Abhijit Tibrewal from ICICI Securities.
Sir, just wanted to understand. This particular quarter, we have shown great amount of caution in the developer or project finance segment. Can we expect the same amount of caution in the coming quarters? So the reason I ask this is September quarter last year, we disbursed about 3,000 crores in the project segment. So can we expect the same level of caution in the coming quarters? Or will we, I mean, again start evaluating opportunities in the project segment, developer segment?
Actually you see, project or developer segment, as compared to last year, we gave 60 crore less loan. It was earlier 89 crores. This quarter, we gave it 29 crore, but you are telling me to expect a September, next quarter. We do not per se discourage project loan. We are for project loan, but our credit appraisal will be more stringent, looking to present environment. And we'll focus more on marketability so that the builder gets the cash flow and repays our money in time. Those things will be there. And we will definitely promote those projects which are into affordable housing so that our monies are secured. So I cannot compare that last year we gave so much and this year, there is no question of being cautious but being careful. So that will be there, but it will be more careful and more stringent.
Okay, sir. And sir, the last -- one last question. Sir, I just wanted to gather your thoughts. Why do we is there a deterioration in the individual home loan segment?
In individual...
Individual home loans. Why is there a deterioration in the asset quality?
Actually, this is first quarter, and I don't see much of any specific reason. It is just seasonality. And some loans, if they don't pay within 3 months, they pay next month, so those also slip into, but the individual loans, there will be some NPA, but our effective monitoring and all those things are there. So we are hopeful in that segment NPA will never increase.
Ladies and gentlemen, due to time constraint, that was the last question. I will now hand the conference to the management for closing comments.
Yes. Thank you, everybody. It was a very good interaction with all of you. We assure you to take care of your concerns, and we are committed to give better performance in the coming quarters. Thank you very much.
Thank you. On behalf of Axis Capital Limited, that concludes this conference. Thank you for joining us. You may now disconnect your lines.