Aditya Birla Sun Life AMC (NSE:ABSLAMC) Q1 2027 Earnings Call

0:01 Ladies and gentlemen, good day, and welcome to the Aditya Birla Sun Life Asset Management Company Limited Q1 and FY 'twenty seven Earnings Conference Call hosted by REG Capital. We have with us today from the management, Mr. A. Birla Subramanian, Managing Director and CEO Mr. Pradeep Sharma, Chief Financial Officer Mr. Paritosh Chitora, Head, Investor Relations. As a reminder, all participant lines will be in the listen only mode and there will be an opportunity for you to ask questions after the presentation concludes. Please note that this conference is being recorded. Before we proceed with this call, I would like to take this opportunity to remind everyone about the disclaimer related to this conference call.

0:50 Today's discussion may be forward looking in nature based on management's current beliefs and expectations. It must be viewed in conjunction with the risk that the business faces that could cause our future results, performance or achievement to differ significantly from what may be expressed or implied by such forward looking statements. I now hand the conference over to Mr. A. Balasubramanian. Thank you, and over to you, sir. Thank you. Good morning, everyone. Thank you all for joining the call for Q1 FY twenty twenty's Investors Call. I hope you all had the opportunity to read through the earnings presentation. It's available on both the stock exchange rates and our company website. Let me begin by sharing our perspective on the current macroeconomic environment.

1:40 The global economy as is known has shown real resilience this quarter navigating the uncertainty from the West Asia conflict with a limited impact on activity so far. The IMF project global growth moderating to about 3% in FY twenty twenty six and before improving to 3.4% FY twenty twenty seven as war related disruptions give way to the strengthening of AI and technology investment cycle. Inflation may rise modestly and keeping central banks cautious on easing. Based on geopolitics, commodities and trade fragmentation remain, but outlook is more balanced with a resilient demand and technology led productivity gain.

2:29 India has handled this crisis better than most energy importing economies held by diversified imports, timely coal transactions and strong buffers and regulated fuel pricing. That said, the higher import costs have pressured the external account with some pass through into domestic prices. That's why we are saying the F and R EBITDA cost is also being announced by RBI. And growth remains supported by strong private consumption, as well as services, improving investment and healthy balance sheet of companies and continued government CapEx. The key risk is a monsoon with the IMD expecting below normal rainfall due to El Nino. Though comfortable food grain stocks, healthy reservoirs better supply management should soften and food prices impact compared to the past few years.

3:16 And overall, the near term challenges are real, but India remains on track to be among the fastest growing major economies. Coming such as the equity markets, Indian Equities are volatile, but into this quarter with sentiment shared by domestic strength, earnings expectations, FI flows and global development. And while large caps stayed range bound amid both our profit bookings and broader market outperformed with the nifty mid cap 150 and small cap two fifty, both posting gains. And FI outflow at various points, certain domestic institutional flows and improving macro fundamentals helped Indian Equities to close the quarter on a stable note. Coming to update on Mature Industry, the quarterly average AEM stood at INR83.14 lakh crore as on 06/30/2026 compared to INR700 lakh crore as on 06/30/2025, resulting year on year growth of 14%.

4:10 The SAP contribution for industry stood at about INR3770 crores for June 26, representing year on year growth of about 20%. Total mutual portfolio stood at INR29.1 crores as on June 2026, growing by 19% year on year, with the unique customer closed about INR5.7 crores. During Q1 FY twenty twenty seven, the industry saw total NFO collection of approximately INR4749 crores across equity and debt mutual funds, equity collections driven by index funds, aggressive hybrid funds and value funds. And despite equity market volatility, industry witnessed continuous flows into various schemes highlighting sustained investor confidence in the long term growth potential of inequities, though we witnessed marginal slowdown in the overall SAP flows. Individual average AEM for June 2026 stood at INR15.08 lakh crores contributing for six year personal total AEM.

5:02 These cities have average AUM of INR 13.6 lakh crores accounted for 18.5% of the total AUM growing by 13% year on year. Coming to the ABSLAMC performance highlights, at ABSLAMC, we are pleased to announce that overall average AUM including alternate assets surpassed INR 6 lakh crores milestone this quarter and now stands at INR 6.28 lakh crores reflecting robust 42% year on year growth. This includes the mandate received from both ESIC and EPFO. EPFO got added in the last quarter. Therefore, overall average assets for about one point five months got added to the overall assets and management. We are pleased to share that we have been invested in EPS mandate approximately INR 6.08 lakh crore. With this landmark addition, our closing total AEM as of 06/30/2026 crossed INR10 lakh crore milestone.

5:51 This achievement reflects the trust and confidence our clients and partners have placed in us over the years and stands a testament to the strength of our financing and investment capability. Our mutual fund quarterly average AEM stood at INR4.28 lakh crores, representing 6% year on year increase. Within this, our equity mutual fund quarterly average AEM stood at approximately INR1.9 lakh crores and growing about 10% year on year. Our equity mix for the quarter stood at 46.5%. Our SAP contribution for June 2026 stood at INR1083 crores, supported by INR40 lakh full year contribution to the SAP account. The total investors fully for June 2026 stood at INR1.11 crore with the new SAP registration for the quarter is approximately INR5.5 lakh new SAP registration.

6:40 Our SAP book remains a cornerstone of our long term wealth creation strategy. Through combined like Subsea Important Plan, we continue to reinforce the value of discipline and systematic investing. To take our SAP book to the next level, we have launched the focus initiatives for both employees and partners and we expect these to drive our stronger outcome in the quarters ahead, though we have seen this quarter a marginal reduction in the SAP's book, but something we continue to remain a bigger focus area to drive the next level of growth momentum. Our investment performance continues to demonstrate strong consistency and meaningful improvement across both our equity and hybrid portfolios. For the past year, we remain focused on strengthening our investment capability, enhancing our investment team and deepening our portfolio constraint investment framework.

7:28 In fact, it is reflecting on the overall performance improvement, not just only in the short term, even in the medium to long term, our performance have been showing an improvement. And these efforts have translated a significant not only performance, it also strengthened. The investors' confidence supported healthy inflows across our flagship offering such as FlexiCap, balanced advantage fund, mid cap, multi cap, Small Cap, Index Fund, where we have seen inflows on our month on month business showing an improvement. In fact, most of these funds are now also featured on the recommendation list of our banking channel partners, which will further support flows in going forward. In fact, this quarter our product got added to the two of the large banks as per the recommendation list, which I hope to improve the overall sales numbers from these channels as we move forward.

8:16 Strengthening and expanding our distribution network remains our key priority in order to improve the overall sales productivity. In fact, I have undertaken what's called Yatra across various cities in India in order to meet all of our distribution partners and the investment community at large. These interactions have brought several insights from the ground, what customers are thinking and how we are perceived by the market. This has given us a great confidence that we are on the right track towards growth, building on the legacy, goodwill and market equity that we have honored over the decade. Technology and innovation remains at the heart of our customer first approach and our efforts to enhance the overall investor experience. As part of our digital transformation journey, we have launched series of technology led initiatives. Our Geniei powered chatbot is designed to engage investors early in their decision journey, understand their needs and guide them towards relevant investment action without recurring human intervention.

9:11 We also launched our new distributors and investors app, enabling enhanced portfolio tracking, seamless transactions and improved business engagement management. In addition, our WhatsApp enabled servicing platform helps investors and partners access services more conveniently and efficiently. And turning to alternate business, we witnessed good growth during the year. Our PMS and AIF assets increased about INR20 thousand 640 crores as of Q1 FY twenty twenty six to nearly INR2 lakh crores which includes the EPFO flows. And this growth was largely supported by ASI and APFO mandates, which I mentioned about it earlier. We also launched ABSLA Correctional Sector Fund during the current quarter and the fundraising is still underway. Along with that, we also have fund launches, which is structured opportunity fund two and money manager fund and India select sector fund in addition to the special opportunity fund Series two in order to build our PMS and AIA portfolio.

10:11 And these offerings are broadly in line with the industry's demand and from differentiated portfolio and investment opportunities point of view. In our real estate business, our AUM stood at approximately INR100 crores, reflecting a 28% year on year growth and fundraising is currently under vein for the Aditya Birla real estate credit opportunities on Series two, which focus on senior secured lending opportunities and post approval brownfield real estate projects across Tier one cities there. With the recent grant of our retail license at Gibcity, we are enabling NRIs and global investors to seamlessly access both inbound investment into India and outbound opportunities across global market And building on this momentum fundraising is currently underway in our ABSLA Flexicap Fund which is a Feeder Fund. We have seen the marginal success in this space to get money from NRA investors in India Feeder Fund through the Flexicap Fund. We're also on track to launch a retail product via Gibsitya in the upcoming quarter including Emerging Markets Equity Fund and India Growth Fund and also launched series of index funds to invest in global market.

11:18 Are product suite and gives it a global investment ecosystem. We are well placed to build scalable offshore franchises in the coming years. And when I turn to our passive business, which remains one of our key strategic focus, We continue to see significant opportunity in this segment and remain committed to building leadership position through a comprehensive product suite, a strong distributed network and strength of our brand. To further strengthen our business in this space, Recently appointed Hemant Bhatia as Head of our Passives along with a team of people under him. He brings more than two decades of experience in building passive and ETF business in India and we assume we will play a critical role in driving product innovation, strengthening investment capability and accelerating growth in the segment as well as add new customer base to this business model.

12:07 And during FY 2027, our passive quarterly average AUM stood at approximately about INR47 crores, representing 14% year on year growth. Our industrial base also continued to expand with the total folio of reaching about INR17.4 lakhs. Within passive, our ETF franchisee delivered particularly strong momentum. ETF quarterly average AUM grew by about 47% year on year, significantly ahead of industry growth of about 29%. And today our passive products suit companies of two digit offerings and expanding equities, fixed income and commodities and the Master Analytics Solutions and enabling us to carry out a broader spectrum of industrial portfolio. In the Apex SAF segment, we launched our first SAF, Apex SAF Hybrid Longshot Fund and backed by our strong investment team.

12:55 But before building our size in this space, we want to establish performance factors of six months. Now that we have six months over, now we start building a size in this space. In order to build a further momentum, we are also now preparing to launch two more SAS equity long short fund and equity X top 100 long short fund. And these additional further scale our SAS platform tapping into the new product segmentation, which I think we can build size. And also to support this business, we added strengthen this team by adding two more specialists to run these products for SM. Moving to financials, Q1 FY twenty twenty seven total revenue is about INR $6.23 crores as compared to INR $5.63 crores with Q1 FY twenty is up by 11% year on year.

13:41 Q1 FY twenty twenty seven profit before tax or INR406 crore as compared to INR372 crores in Q1 FY twenty twenty six, up by 9% year on year. And Q1 FY twenty twenty seven profit after tax, INR309 crores as compared to INR77 crores in Q1 FY twenty twenty six, up by 12% year on year. With this, I would like to open the floor for any questions that you may have. I'll be joined by Pradeep to take any of the questions that you may have. Thank you, sir. Ladies and gentlemen, we will now begin with the question and answer session. Session. Our first question comes from the line of Swanav Mukherjee with three sixty One Capital. Please go ahead.

14:45 Hi, sir. Thank you for the opportunity. Two, three questions from my side. First of all, sir, if I were to calculate the yield for the primarily focusing the active part of the business and keeping out the AUM for the EC and the APFO mandate. I mean, I can by my calculation, I am seeing some increase in yield. Just wanted to understand whether this is the right approach? And the increase, how should we think about it? Is this an outcome of the TER regulation and we have actually slightly benefited, if you could highlight on that? Second is also if you could call out the segment wise, would be very helpful. Thirdly, sir, wanted to understand on the employee expense part, what is the reason for the increase? And is there anything one off there? And also, if you could call out the ease of number in that? This will be my question.

15:51 Sure. Yes, I'll proceed to answer the... So, Swayal, this BER actually now this was effective from 04/01/2026. So that has been rolled out completely. And we have optimized the commission structure along with the management of cost. And this is win win for both as an AMC for us as well as for our partners. So that has been rolled out and the ease what is there in Q1 reflects the tube picture and will be maintained going forward into in these levels. Yes. Coming to the yield levels for equity, it is around 63 to 64 basis points.

16:38 That it should be around 24 to 25 basis points. And liquid would be in the range of 12 to 13 basis points and ETF around eight basis points. So these are the yield levels. Coming to employee cost. Employee cost for this quarter has increased mainly due to the cost. If you remember, actually rolled out the ESOP for the employees in Q1 in January from effective January 26. So this is because of that. The impact of that is around INR 10 crores per quarter of additional employees cost through the ESOP.

17:26 And roughly the employee cost, which is there in Q1, should continue in the same range for coming quarters. Yes. Okay, sir. Very helpful. Understood that, sir. Just a follow-up on the headline yield number that you have mentioned. So as you said that this is a true picture. Now how should we think about overall the dilution of the yields going forward as our AUM increases? And also, if I could squeeze another question more on the broader industry level that we are seeing this trend that a lot of manufacturers are focusing on the asset side and the EPS side in and planning to develop that. So over the next, say, three, five years, sir, how would you be foreseeing the industry, say, from the active side as well as from the passive side, how should we expect things to develop?

18:30 Yes, these will be my questions. So, Swan, actually, see, by and large, now this the regulatory changes have been now rolled out. And now only thing which will come in play is the telescoping pricing, which will be based on the AUM size, which will grow, right, as you are aware. So what we can do as a we will all as a business would like to maintain our yields plusminus few basis points. This is the mix, mix which we will be working on through the alternate business. So we feel that going forward, the yield should be in the similar range barring one or two basis points here and there, plus the telescoping pricing. Sir, do want to Yes. Add Just to add to that, with respect to the in terms of passive business growth, the way Pradeep was mentioning, as the size improves, definitely the silicon price will be coming in.

19:30 But we also believe that active will continue to be the dominant asset class when it comes to the Krishna overall momentum growth. But having said that, the passive is something in order to build choice to the customer, at the same time ensure that asset allocation remains key. So passive is something we have now invested on people who have a passion towards building passive. The way we are looking at passive is it should help us build scale and get more at the same time, to be extremely low cost kind of product. So I think the way we are looking at will add to the overall profitable numbers as in terms of absolute profit. Of course, margin could be lower given the fact that we pass on the benefit both to the customers as well as in the form of low expenses.

20:27 But in terms of additional profit revenue as well as the bottom line, that's something is the roadmap in which I think we are trying to drive. Even the gifted tea product that we'll be looking at doing, especially for investing in overseas market, that also we are doing with a similar intention. Of course, the expenses could be lower than the actually managed funds. But at the same time, given the fact that it can be relatively lower. But Abdul's profit will add to that scheme will remain high. But in terms of mix, I think the way we see is, say, today if we look at the package about INR 11 lakh crore roughly is the size. If you knock off and date based investment, the pure retail would be roughly about 2.5 crore.

21:16 Within that, if you take large components coming from gold and silver, again, it will remain on our asset class for us to focus, which gives reasonably good profitability as well. So maybe this number will keep rising. At the same time, our intent is actually to build size in the key product, which is where we believe that given the comparable asset class in the same size if we take, given the significant improvement in performance that we are witnessing, we will focus on building a size in our core product, which is what our current focus is, while building our base for the passive and ETF. Right. So this is very, very helpful, sir. Thank you so much and all the best. Thank you.

22:04 Our next question comes from the line of Mohit Mangal with Centrum Broker. Please go ahead. For the opportunity, good evening, everyone. As you just said that the commission was restructured. So out of five bps, how much was kind of transferred to the distributors? So Mohit, actually so we have optimized the commission structure so that it is win win for both, right? So there's no on terms of basis points. So we have reviewed the entire whole ecosystem of commission, and we have ensured that it should remain neutral for everyone and win win for we as an AMC as well as for our distributor partners.

23:05 And then the outcome is that, by and large, our deals also remains intact. And by and large, distributors also maintain their margins. Yes. See, the broad approach we have taken on this space is what do you mean by win win is something neither I can make too much profit nor we can take hit at the same time from distributors point of view also. So when we relook the whole model and looking at the account, this is only the sharing formula that we have. I think basis which our own assessment is significant benefit or the loss. So that's the way we approach it. With the marginal here and there, some benefit would have accrued to us, some benefit would have accrued to distributing some of it. But broadly, we have kept it more like a neutral kind of impact.

23:54 Understood. Understood. Also second question is that we have kind of lost market share in FYP as well. So just wanted to know that given your opening comments, you said that your flagship teams have been doing well. So where are we seeing problems within the SIP? Is this non flagship teams? Or how should one look at it? No, flagship team, our effort has been to build. I think flagship team as it is that our 700 flagship teams we have mentioned, we are seeing improved flows even compared to the last year as well as even this quarter too. I think largely our SAP especially in the ELS schemes are seeing general outflow in the industry and we did have impact on some of the ELS scheme. Even industry also this time the cancellation rates are higher than the previous quarter.

24:47 So to some extent, I would say that product that has added to the because sometimes some of the for long, we have seen some cancellation in that. But having said that, the core schemes, is one of our intent is to core raminate schemes that we have identified is the one where we call it a focus product that we are seeing an improvement in terms of SAP registration as well as SAP drive. So this quarter was more or less as a result of what I just mentioned. Then secondly, as far as season comes concerned, I think the volatility that we witnessed in interest rates, especially in the month of May.

25:32 May was actually a little panic month when it comes to our fixed income. And fixed income, we do have large size in the non liquid fund, liquid five plus category, which is basically duration based. We did lose some bit of money. In fact, those all the money has come back in June end and July. At least for a month, I think that's actually in the month of May, that's why it got impacted in the average assets. Otherwise, had it gone in the June end, it would not have had an impact. They went in the month of May and coming back after month gap. So it had an impact on the overall average assets. Understood. This is helpful. Data keeping questions. If you can spell out the PMS or AI for the non mutual fund revenue for the quarter and the SIP SIP AUM is approx INR 87,000 crores for quarter.

26:36 And PMS and AF contribution, if you see contribution on total revenue on gross basis is around 7% for the quarter. And on net revenue basis, post payout of commission to distributors is around 4% on overall revenue. So, out of 463%, 4% would be PMSEIF revenue, right? Yes. Yes, yes. Understood. Sir, thank you and wish you all the best for the entire year. Thank you. Thank you. Thank you. Our next question comes from the line of Lalit Mohandew with Equity Securities. Please go ahead. Thank you for the opportunity.

27:27 Thank you for the opportunity. So just I have two questions. So firstly, on this in this particular quarter, just mentioned that we are seeing some healthy flows in our flagship products. So just wanted to understand if you could give some more color into it like in terms of the market share, how is it tracking with respect to our overall MAU market share in flows in those particular schemes? And also if you could also give some color on from a channel wise perspective like where we are seeing some healthy flows and where we are seeing some more probably some redemptions over there, probably on the distributor side or banking channel? Yes. See, with respect to these core funds, they are saying, though I'm not exactly how much is the improvement in the market, generally look at the flows.

28:20 The core funds such as flexi cap, balance of knowledge fund, multi cap, small cap, so on a mid cap and multi asset gain fund. These are the generally core funds including I'm even seeing the flows coming in via PSC equity fund given the fact that good performance record. And we are seeing flows in these core funds. And our idea is that it will ramp up the flows into these funds by keeping this as a high focus area for the entire sales team across the country. And wherever even I've been traveling with my sales team across different parts of the country to push over the overall engagement. I do see positive wise coming from each one of them acknowledging that some of our fund performance is even beginning is being better than the competing funds in the same category, where the volume would have won in the last three, four years. That's something is there is high relationship which is there.

29:16 And second, with respect to the with respect to the channels, more or less steady growth, but I see MRD volumes gradually is picking up. With the banking channel, earlier some of our products are not part of the approved list. We already started seeing products getting now becoming part of the approved list. Recently, it is bank has approved some of our products and Kotak team on boarded some of our schemes. And we have seen already product approved part of HSBC, Air Securities, F Bank, sorry, as well as on Standard Chartered Bank and also the some of the other wealth management firms including LGT Wealth, Ask Wealth and Anderson Bank.

30:04 Some of our products were probably missing as part of their comparison, such as Flexigap fund, balance of note expense, even our equity savings fund on the fixed income category. These are now getting added to the overall recommendation list, which in my belief is given the fact that our engagement is pretty good and also they normally sell the product that are part of recommendation list, I see improvement coming from sales engagement leading to a better outcome from these channel partners. We are already seeing this coming in some of the bank channel partners. In fact, this bank added only a flexi cap fund only in the last two weeks. And I didn't do all AM growth. Sure, sir. Thank you for that detailed answer. And sir, just one data giving question. Could you also spell out the total number of employees as of June end?

30:59 So total number of employees as of June end is sixteen thirty eight. Sir. Thank you. Sixteen thirty eight. Yeah. Our next question comes from the line of Abhijit Sakharay with Kotak Securities. Please go ahead. Hi, good evening everyone. So first question is a clarification on the data. When I look at the Slide 11, where you have the closing and the average assets under management, Just wanted to clarify that I would have thought the equity AUM, the closing AUM would be slightly higher than the average for the quarter given the returns from the market and what we've seen with other players. So just wanted to clarify that first.

31:56 And second question is, in terms of the ESIC mandates, if you could give some idea in terms of what would be the annualized revenue from these mandates? And last question, sir, would be just a qualitative one in terms of close. What would you say would be, say, top two or three funds where you expect maximum close in the next twelve months? On the closing year, anything? Yes. Top two, three funds? Yes, yes, yes. So, in terms of I'll take the last question first. In terms of funds that we see with respect to the accompanying funds, also the funds which remains relevant from the broader distribution community point of view and when it comes to allocation of money.

32:52 First and foremost, Flexicap fund. Second is balance of bond issuance. And third is the multi asset allocation fund. And fourth is the small cap fund. Though we don't position mid cap at this point of time, we also wanted to do a justice in showing a high conviction on the space. But however, we are seeing some of the flows coming in. Among the thematic and pure early fund also, we are disposition, but otherwise largely the four, five funds. In the hybrid category, both the SAS, the new one that we have launched, as I mentioned, we want to establish performance record before we start pushing it. Other we have in place, again, are driving that from an overall flows point of view.

33:38 And equally saving fund again comes with equity taxation from a large pool of H and A investors who does not have major equity in terms of equity return, but also we have position. In fact, some of the conservative investors we have positioned that as a scheme for flows. So that's the broadly we have positioned, but the key schemes largely remains Flexicap, Multi Asset, Balance Outnotation Fund and SmallCap. With respect to the AEM ESIC, ESIC mandate of course in terms of the revenue, very marginal. We don't earn any much on this. Of course, we do have a team of people who actually have a separate team of people for managing both the APFO and the ESIC mandate.

34:28 That's what the requirement is. But otherwise, in terms of revenue, it doesn't add much revenue to us. Like that, it doesn't give you big revenue, but definitely it's opened the gate for privately managed APFO through which we are seeing some of our fractions in terms of flows coming through us. Passive funds as well as active managed funds, though it's a small beginning, but we are giving a complete repush rather we are emphasizing the need for reaching out to thirteen fifty to contribute from the equity contribution to our existing funds, purely on the base of the mandate that gives the edge over others for us to get closer.

35:16 In terms of closing versus average, Pradeep is just giving you a clarification on that. So Abhijit, average equity AUM for quarter one was 198,722 crores And closing also was INR 198,969 crores. So because if you see in quarter, during the quarter, there were dips in the market, and that's why the average also is also is in the range of closing only. So I think you were saying that why this is in line with closing, there should be some movement on this is the market movement. But if you see our during the quarter, April to June, there were days wherein market also have dipped. That's why average is also in the similar line.

36:06 Got it, And sir, last question, Birla, sir, any OpEx growth outlook for the year? OpEx, I think remain within the inflationary guidelines. Employee cost as we discussed in the first call was employee cost should remain largely in the similar range as we have already factored in the ESOP cost, etcetera, which based on for the new ESOP plan, which was rolled out for the employees. Other than employee cost, it should largely remain with as per the inflationary normal situation. There are no cost shocks, I think, as of now. Got it. Thank you so much. Our Our next question comes from the line of Deepanjan Ghosh with Citibank. Please go ahead.

37:10 Hi. Good evening, sir. So a few questions from my side. First, if I look at your nonmutual fund portfolio, and this is excluding the large mandates from APFO and ESIC that you have received. And if I look at the AUM ex of that average AUM, I mean, from 1Q 'twenty four to 1Q 'twenty four, which is almost a three year horizon or two, three year horizon, I mean, things look largely stable in terms of the average AUMs, ex of the large mandates despite kind of onboarding new teams, strengthening the sales franchisee, etcetera. So just wanted to understand, I mean, if I were take a two to three year view, I mean, given that the market space has kind of widened, your franchisee has deepened. I mean, how should one aspire to either look at AUM or revenue contribution from this ex large mandate non MS book?

38:02 That's the first question. The second question comes back to the SiP market share. Now if I understood correctly, you mentioned that ELS has seen some amount of rundown and maybe a little bit of pressure in terms of flows. Now correct me if I'm wrong, my understanding would be that ELSS contribution to SiP at industry level might not be that relevant. So unless ELSS SiPs for you guys are a meaningful contributor, triangulating the SIP market share decline quarter on quarter or at least from March to June looks a little challenging. Or in case you can give some color on that or maybe the quarterly SiP data that would be useful ex of maybe ELSF also. And third question would be on the fee and commission expense.

38:50 Is it fair to assume that the increase that you're seeing in fee and commission expense for the past few quarters is largely attributed to the all non aero business basically, and that should kind of remain robust given the product pipeline that you have? Those are my three questions. Yes. So with respect to the first question around the AIF side, the one, if you look at our alternate business into three categories. One is the PMS long only equity, which is in the listed space. So we have roughly about 5% growth kind of size. And while we have grown with the last that's an asset class we want to build size. In fact, we are already part of our part of this. Some of these leading wealth management team approved list. Definitely, have a target to take it to anywhere between 20 crores, 20 crores over the next three years.

39:57 The second category is we have built where we have built capability, internal capability as well as the team is to build AIF performing credit as well as the AF money market fund in the AF category. And third is the AF real estate credit fund. The listed credit fund, we have established reasonably good tracker cost return to the investors. The same way performing credit, so far we have been able to deliver close to about 40% return. It's again it's being seen by people underwriting that we have done reasonably acceptable underwriting we have done. With that, our intention is to build the size to the next level. I think each one of them will come for about anywhere between 2,000 crores kind of size to start with.

40:51 That is one of the reasons we also given a commitment from our ANC P and L in order to provide seed capital up to 10% of the fund size. At the same time, we'll provide a temporary bridging gap whenever they have a deal, so that we can participate in some of the large deals, at the same time get money into the fund. That is the model we applied as per the AF Credit Performance Credit Fund. And third is, of course, Gift Gift City is something now that now we got the retail license. Clearly, we have a road map in building Gift City, both for inverter maintenance and outdoor remittance. In fact, the two gentlemen the three gentlemen who are joining on our passive side, they are quite convinced and quite bullish in terms of building.

41:40 UCT has one of the route for domestic savings to get diversified in the international equity market. And therefore, we will launch a few products in that segment. That is what I think will build the side. As far as domestic concern, even the passive side, some of these institutional investors as well as recognized who largely chooses the passive funds as part of the normal asset allocation. But also we have put some one off in place. In fact, the new team of people, they are also quite convinced and passionate about building passive. Therefore, there is something which the fourth category will do. That's why we are building the overall size. In fact, the way we always drive our alternate business should not only add good to the overall AUM growth, but it should also add good to overall profitability, so to speak.

42:29 That's the way we built. And the second question, Pradeep is just answering. Yes. So SiP cumulative contribution for the quarter was around INR3300 crores, which is actually in line with Q4 numbers also. So in fact, in Q4 also, the contribution was around INR 3,300 crores. However, there have been month on month fluctuations. So this is one. And secondly, you asked about the alternate revenue revenue. I think largely we feel that because all our verticals, LOBs are so largely we feel in coming quarters, I think the revenue contribution for alternate should be in the similar range, except 1% or 2% here and there, I think should be there because all our LOBs are firing.

43:25 So all our LOBs are growing. So we feel that in coming quarters, this should remain in the same range. Yes. See, I'll try it while we are seeing somewhat of a pickup, I think increasingly we are seeing acceptance for the product ultimately that should lead to a volume conversion, which is what my belief is. We'll start. Even PMS, there are certain markets where we have been pushing even at the MFT level is also seeing some of success there. So that's something which we believe that as we move forward, we will see a big gradual momentum in this space. Sure. On the fee and commission expense increase, is that partly attributed to new launches and marketing expense in the all PMS businesses?

44:15 Yes. So fee and commission expense is actually directly linked to the business of alternate business because this is a commission which is paid to the distributor community. So I think that is directly linked to the business which we will be garnering on the alternate side. So I think this should have similar growth rate of our revenue for alternate side. Got it. Just maybe one small question, if I can squeeze in. You mentioned that you normally tend to look at absolute flows other than the market share, which looks fair. So if you were to index your flows to 100, let's say in 1Q 'twenty six or 4Q 'twenty six, how would the trajectory be tracking incrementally, let's say, for the quarter on a 100 basis? I mean, indexing 200 a particular base quarter?

45:08 Harish, generally, I see improvement over when I look at the number very objectively from last year, similar quarter, this year, similar quarter, the numbers are better. But if you look at last year's full year run rate versus a three month run rate is actually better than the last year's full year run rate. But however, when we began this year, just to give you some sense, April was pretty good for us. April was started quite well. And May generally was May and June was relatively muted as we have seen generally in the equity market. But otherwise, the trend is largely is getting better as far as the key funds flows are concerned, which is why I mentioned, comparing with the market share right now, how the flow is improving is something.

45:59 I think once it gets established, it comes in auto mode. Then naturally, we'll be able to link that one to improvement in the gap between competing from the same space. That's where we start looking at it. But I think we'll give some time for that now that the products are coming as part of the recommendation list. And now that the performance of the longer term also now getting better. So that's the way normally I see it. Got it. Thank you everyone and all the best. Thank you. As there are no further questions from the participant, I would like to hand the conference over to the management for the closing remarks. Thank you and over to you team. Yes. Thank you everyone for with this we'll conclude our Q and A for 2022 earnings call.

46:52 If you have any questions, please feel free to contact Prateep Paritosha. Yes. Thank you. Thank you so much, sir. On behalf of Aditya Birla Sun Life AMC Limited, we would like to formally conclude this Q1 FY twenty twenty seven earnings conference call. We sincerely appreciate your participation in this event, and we kindly request that you may now disconnect your lines. Thank you for your time and engagement. Have a great day.