• Credit cost improvement: Credit cost dropped to 3.3% in the latest quarter from around 9.4% last year, and full-year credit cost is expected to settle around 3.6% to 3.7%. Asset quality has improved significantly, with 30-plus delinquencies on loans disbursed in the past year staying below 70 bps.
• Growth and diversification: The company targets 20% growth next year as it expands into LAP, individual, gold, and MSME loans. The non-GLG portfolio currently stands at 15% with 100% repayment, with plans to reach a 65:35 GLG to non-GLG mix over the long run.
• Operating expense efficiency: Operating costs declined to 6.1% in the quarter from 7% last year, supported by a 10% increase in AUM per branch. Digital collections currently stand at 45% and are projected to reach 75% next year.
• Cost of funds: Incremental cost of funds has reduced to around 9.5% while overall borrowing costs remain below 10.25%, driven by PTC transactions at 8.5% and newly announced government credit guarantee programs.