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00:00Northern Arc has also seen a strong debut on the bosses with a near 33% premium to its
00:06issue price.
00:07We spoke to the management that is the MD and CEO, Ashish Mehrotra on the road ahead.
00:12Listen in.
00:13You know, what's really exciting is you tend to think that people who focused on this high
00:19growth sector tend to be niche.
00:22We've demonstrated with the response we got from the large amount of participation is
00:28that a business with consistency of performance and more importantly, commercial viability
00:33and the impact it makes is generally exciting and attracts the center stage of what we do.
00:40We essentially enable the flow of credit to India's underserved household and businesses.
00:46We cater across the seven core sectors, essentially addressing the needs of the retail customers,
00:55whether it's affordable housing, whether it's a small micro loan, whether it's a business
00:59loan, so on and so forth.
01:00And we do it through the multi-channel, i.e. we lend money to the customers and also to
01:06our partners for them to online.
01:10We use that opportunity to create credit solutions for them to raise more money that creates
01:15a sticky fee income for us.
01:17And then we also use our domain expertise and knowledge to invest again in the six to
01:23seven sectors to ensure the seamless flow of credit.
01:26Fair to say a unique company, which is leveraging its domain knowledge, data and digital capabilities
01:34to ensure flow of credit.
01:36We've impacted over about 101 million lives so far, directly, indirectly, and that's the
01:41power of the franchise.
01:42Right.
01:43Great.
01:44So that's, that's everything on Northern Ark in a nutshell.
01:48Let's try and peel that layer by layer.
01:51Let me first start off with growth.
01:54It's a high growth sector for sure.
01:57Industry grows maybe 18% compounded.
02:03You're a smaller, relatively decent-ish size.
02:07Where should it be?
02:09What is your growth expectation?
02:11Maybe in the near term and over the longer term, maybe three, five year view?
02:16I think the way to look at it, one, don't compare us only from the balance sheet.
02:22We play on the three sets on the multi-channel, i.e. we lend.
02:27We provide placement solution, which is equal to the amount of lending we do.
02:31If you compare on an absolute rupee basis.
02:35And then we invest in the funds across in the six sectors.
02:39So our balance sheet has been growing at about 31% over the last three years.
02:43We've demonstrated a very resilient and a high quality performance, both in terms of
02:49the NIMS, in terms of adjusted credit cost and so on and so forth.
02:54And then we use that opportunity to create a sizable amount of fee income.
02:58If our balance sheet is about 11,700 as of March, we would have provided placement solution
03:06of the similar quantum to our originating partners of about 11,700 plus.
03:11And then we would have invested sizable through the fund structure, again in these sectors.
03:16So you have to look at the aggregate value.
03:19And if you look at the aggregate value, it's significantly higher.