CSL Finance Ltd

- The company has been focusing on building its liability side and expanding its lender base, increasing from 4 lenders during COVID to 15 lenders currently. - They expect more lenders to come onboard in the current financial year to support growth. - The company has a leverage ratio of 1.13 via the debt route and sees scope to leverage further when opportune. - Management indicated discussions with several new lenders in the current quarter, with optimism about reducing the cost of borrowing. - No explicit mention of upcoming equity fundraising was made, but a credit rating review is planned in the current financial year which may support future fundraising efforts. - Overall, the company is focused on debt-funded growth with improved cost of funds and lender diversity.

- Capital expenditure (CAPEX) for a new branch is generally modest, not exceeding ₹4-5 lakh. - Operating expenses (OPEX) for a new branch are around ₹45 lakh per year (approximately ₹3.5-4 lakh per month). - Management plans no significant increase in OPEX proportional to business growth; existing platforms are ready for scaling. - Focus is on scaling operations from current branches rather than major new investments. - 6 to 10 new branches planned for the coming financial year, with possible shutdown of 1-2 underperforming branches. - Employee additions will be primarily at the branch level aligned with new branches; current team size is sufficient for larger operations. - Efforts ongoing to improve technology capabilities and operational efficiency, with no major capital-intensive projects mentioned. - No mention of specific large strategic investments; emphasis is on controlled growth and leveraging existing infrastructure.

- The company is on a growth path with an increasing number of lenders (from 4 to 15), aiming for further expansion in the current year. - Focus is on growing both SME and wholesale loan portfolios, with SME expected to grow at a higher year-on-year percentage. - Target to achieve a 50-50 mix of SME and wholesale AUM by the end of the next financial year, shifting from the current 40-60. - Plans to add 6 to 10 new branches in the coming financial year, netting 8 to 10 branch additions after possible shutdowns. - AUM per branch target is to move from around ₹7.9 crore to at least 2.5x in the next 2-3 years, reflecting growth in volumes and profitability. - Incremental business from existing branches expected to drive better margins without proportional OPEX increase. - Credit rating review is planned, facilitating access to more lenders and potential growth instruments.

- The company targets higher business growth while maintaining control on the books, focusing on sectors like NBFC Rajasthan Global Securities (₹1,500-1,800 crore size). (Page 21) - Expected significant growth in the SME segment, notably SME LAP book, with year-on-year growth higher than overall AUM growth. (Page 18) - Operating expenses (OPEX) are not expected to increase proportionally with business growth, leading to better margins as additional business scales up. (Page 13) - Branch productivity improvements anticipated, with profitability per branch expected to increase 2.5x over the next 2-3 years as existing branches mature and new branches add selectively. (Page 13) - Focus on growing SME and wholesale portfolio towards a 50-50 mix next year, with stable teams, technology, and processes in place to support growth. (Page 5) - Overall, the company is optimistic about FY24 growth, leveraging enhanced credit rating and expanding lender base. (Page 5)

- The company targets order-based lending primarily in the SME segment, focusing on raw material purchases backed by confirmed orders. - Order-based loans have short tenures (60 to 90 days) with continuous flow due to recurring orders. - Management indicates that repayments are very predictable, reducing risk in this segment. - The SME portfolio comprises small-to-mid sized borrowers, mostly in the NCR region with better collateral and lower LTVs (~40-45%). - The strategy involves cautious expansion with extensive 6 to 9 months of research in newer geographies like Dehradun, Rishikesh, Haridwar, and Lucknow. - There is emphasis on maintaining total control over large wholesale loans, especially where ticket sizes go beyond ₹15-20 crore. - No explicit current or expected orderbook value is disclosed, but the company expects higher growth in the SME segment going forward.