Alternatives
- Aim to earn 2-3% per annum on AUM (Fees+ Carry)
- The hurdle rate is 8%. Anything earned above that is part of carry income.
- It takes around three years to deploy funds in full amount.
- Aim to deploy around 10-12000 cr per annum
Co-lending
- AIM for FY26- If we get a disbursement of 5000-6000 cr per annum, we can generate 150-200 cr PAT. The current disbursement number is 1500. Last year, it was half of that.
→ This means FY24- 2000 cr/FY25-3500/FY25-5000 (my guesstimate)- This shall report more than 50 cr PAT in FY24 (assuming that number triples to 150 cr), as Mr Shah said in the call. - 15-20 ROE is possible
- Co-lending- Offer 80% to banks. Customers get a lower rate (bank’s rate for 80%) and NBFC’s effective rate of 20%. So, Customers get lower rates, banks get better business, and NBFCs get better ROE.
- It is 50% better from a returns point of view, but you have to work hard 200%
- It is still evolving and may take another couple of years to reach maturity.
MSME
- Current annual disbursement –
MSMS – 1000 cr (Fy26 target 6000 cr)
Housing – 1500 cr (Fy26 target 6000 cr)
Total – 2500/3000 cr per annum
Aiming for annual disbursement of 11,000 to 12,000 cr within the next 2 years
Housing
- Current equity is 800. Retained earnings will take it to around 1000 cr over the next 2 years.
- No plan to inject additional equity in HF
- If we get a disbursement of 5000-6000 cr per annum, we can generate 150-200 cr PAT. The current disbursement number is 1,500. Last year it was half of that
Other
- Nuvama stake, which is valued at 1400/1500 (based on CMP) shall be sold in a couple of years
- Value Creation priorities
- MF/AIF
- Credit business profitability based on co-lending
- Insurances
- Expect to communicate to shareholders the next set of value creation plans in the next 3/4 quarters
- Do not expect any impairment to the wholesale book. They can see SR if needed, and there is a good secondary market for it
- As the economy is improving, real estate is improving, recoveries are happening in SR
Note: Invested
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