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“We have got more than 52% demand from tier two, tier three cities only and tier one accounts for close to 48%,” says Y Viswanatha Gowd, MD & CEO, LIC Housing Finance.

For the full financial year that has gone by, NIMs have come in lower year on year. Is it because of heightened competition?
In the first half of the current year, NIMs were much lower at around 2.12%. Thereafter, a strong recovery took place and now we are able to show 2.65% for the quarter. Going ahead, we are maintaining it in the 2.4% range.

The consensus is that come June and we will see another rate hike by the RBI MPC and if not June, maybe thereafter. Can you talk to your shareholders, our viewers and the analyst community on the breakup of your assets and liabilities when it comes to the fixed bucket and the floating bucket?
We have given a conservative estimate. Our borrowings are both fixed and floating and quite a good amount of it is at fixed rate. I always use a lot of cushion in maintaining these ratios and NIMs are also likely to stabilise around 2.4%.

In the first half, some provisions were upfronted. Are you expecting recoveries against the provisions?
Last year, barring the lockdown periods, collection efficiency was excellent. Even at the current level, our efficiency is more than 99% and especially after the June quarter of last year, there is a very good turnaround. That is why GNPA has come down from 5.93 to 4.64% levels. The worst is behind us. We are very confident that going ahead it will come down further and gives us more leverage in maintaining very good margins.

Your project loan portfolio has seen a de-growth. What is happening exactly?
Last year, we could not do much in the project fund because some of the loans that we had given could not become regular service. In some places, things were not in place as far as the project loans were concerned.

This year, we are very sure that we are almost double our performance in project loans and then we have identified some segments and some cities where we have kept the system in place and our teams are there. This year we are really positive of showing very good growth in project loans and we will increase the book level from 5% plus to minimum 8% in this year.

Your disbursements for Q4 FY22 have gone down on a year on year basis. What trends are you seeing when it comes to disbursements?
We are very certain that the economy is reviving very fast and there is good potential around these things. We do not have any doubt that too our teams are very much confident and then our channels are very strong and spread across all the geography areas. Also with more focus on affordable housing, we are very sure to register a minimum 50% growth in this year FY23.

In which geographies are you seeing less demand? The Chairman was saying that most demand is coming from first-time home buyers?
If you look at the geographies, last year also we were having very good call penetration across tier two, tier three cities which were showing very good growth last year. We have got more than 52% from tier two, tier three cities only and tier one accounts for close to 48%.

This year also we are more or less sure and we are now revamping our processing centres. There will be good growth in tier two, tier three cities. Segment wise, 70% are in the salaried class.

Can you give some kind of guidance on ECL for FY23?
Already very good systems are in place and a taskforce has been set up by our team members to help us reach pre-Covid levels at the earliest. By the end of FY23, NPAs will be around 3% or less than 3%.


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