Not sure how much moderation can happen, but could be slight moderation if any. At the same time, note that gold loans are short term loans(3-9 months) given at 24% and there may be not be much moderation needed here....(Remember we pay 36% on credit card cash loans from banks still for short duration loans!) Further, the company has high CAR(22%) and very low gearing(3-4 times) and also high cost of funds(9.9%) currently - so it has these additional levers to further improve the margins or atleast sustain the margins near the current ones.
Regarding , utilization of existing branches, need to check - BUT they do have humongous CROSS-SELLING opportunities wherever feasible/possible. They can leverage the same retail customer base here (from gold loans ) for other types of loans(vehicle/home).
here are some additional points from Conference call(from a brokerage report):
--Presently, Non gold loan business accounts for 15% of the total. The management has cited about increasing it to 25% level by 2018 and further to 50% by the end of FY20.
--60% of the total business is now through online channel increased from 50% on Y-o-Y basis.
--Management stood positive about Q4FY17 and expects it to be better than Q3FY17, which was impacted by the demonetization drive.