The board of the company has already approved a total of Rs 1800 crore of fund raising which includes up to Rs 1400 crore through QIP and Rs 400 crore through warrants to Bajaj Finserv which is the promoter company. According to Bajaj, as per Sebi rules, the warrants need to be issued within the next two weeks but the QIP can be done over the next one year. The commercial loan book of the company continues to look stable with a net loss of 25 basis points, the lowest in the industry, added Bajaj. Below is verbatim transcript of the interview: Q: Your net profit is at Rs 707 crore versus Rs 707.6 crore year-on-year, a flattish performance. What can we expect going forward? A: What is important when you look at Q4 numbers, you very correctly pointed out our profit after tax is flat at Rs 707 crore. However, the three main subsidies when I look at Bajaj Finance , profit after tax is actually up 27 percent to Rs 231 crore. The same is true for our general insurance company, Bajaj Allianz General Insurance, where our profit after tax is up almost 43 percent to Rs 144 crore. So, the reason that the profit comes down is because our life company has reported a low profit and there the profit for the quarter has come down from Rs 688 crore to Rs 559 crore. For the life business what we have to keep in mind is the number that we see today on renewal premium, on profit is because of business done in the past. What is relevant is that the new business which is currently being done, that must grow and I’m happy to report that after many quarters of very slow growth, in Q4, new business premium is up 38 percent in the life insurance company to Rs 1,127 crore. Looking at the fact that we have now finished a year since the launch of new products in the life insurance business after the regulations changed and with the hope that the economy continues to grow, we are looking forward to a better FY16 for the life insurance business and a continued strong FY16 for the finance and the general insurance business. Q: Concentrating on the Bajaj Finance numbers you have reported a stable gross non-performing loan (NPL) this quarter as well as you have for many quarters now. What is the outlook in terms of lending right now? Which segments are seeing the maximum amount of traction and what can we expect in terms of credit growth as well as gross NPLs going forward for the lending business? A: As far as next couple of quarters are concerned, our consumer lending book which is our two-wheeler lending as well as consumer durable lending and a number of other lifestyle products that we lend against as well as our small and medium-sized enterprises (SME) book seems to be stable and growing. Our commercial loans are in a line which is slow, reflecting the overall economy. The quality of the book continues to look quite stable with a net loss of 25 basis points, this is the lowest in the industry, quarter after quarter and this is despite the fact that again in this quarter we have done an accelerated provisioning on loans just trying to be more conservative. So, when I look forward, this is a stable number that we can see at least for the next couple of quarters. Q: You have announced some fund raising via QIP of up to Rs 1400 crore for Bajaj Finance. What would be your capital adequacy ratio at this point, what will it shore up to and what will the funds be used for in totality and when could you even hit the markets? A: The capital adequacy is currently little over 18 percent and so, we are very well capitalised. This is just to take into account future growth and we like to be conservative and so, we like to keep a little extra capital. The board has approved a total of Rs 1800 crore of fund raising – up to Rs 1400 crore through QIP and Rs 400 crore through warrants to Bajaj Finserv which is the promoter company. The warrants need to be issued within the next two weeks as per Sebi rules whereas we have a window of one year for the QIP and that is the time period we are looking at. We periodically go to the market because it is typically a business where in the last three- four years the business has been growing, our topline has been growing at 30-35 percent; that is the growth on the book. Our return on equity (RoE) is a very healthy 23-24 percent but there is still a gap over there that needs to be funded and that is why the fund raising again is just to take care of future growth prospects for the company. Q: Can you tell us a little more about the insurance business, would you take advantage of the FDI limit up to 49 percent? If so, how? A: This issue has been pending for a very long time and one of the main reasons why the earlier bill was pending, we are happy that it got cleared. The new act will also allow significant amount of modernisation of the insurance industry and the way it is run going forward including products, distribution channels. The 26 percent to 49 percent, in our case, both our companies have been very profitable. Allianz and Bajaj have played a very strong role as partners in making this happen. As a result we have excess capital today both in the life and non-life companies. The two companies don’t need additional capital in the next few years at least. So, this would then be a decision from partner Allianz to take their stake up from 26 percent to 49 percent. We would welcome that. We will know more about it maybe in the coming quarters or over the next year or so.