Aadhar Housing Finance delivered a robust Q3 FY26, characterized by 20% AUM growth and steady asset quality improvements. The company is benefiting from a declining interest rate cycle and the PMAY 2.0 scheme, where it leads in subsidy claims. Management expressed high confidence in hitting the ₹30,000 crore AUM milestone by FY26 end while maintaining industry-leading spreads of nearly 6%.
vs Q4 FY26
Notable Quotes from the Call
Most Confident Moment
Rishi Anand stating that January numbers are already trending higher than December, providing full protection for Q4 guidance.
Least Confident Moment
Slight hedging on the exact retention percentage of Balance Transfer (BT) requests, deferring the specific data point to a later follow-up.
| Metric | Value | YoY |
|---|---|---|
| AUM | ₹29K Cr | +20.0% YoY |
| PAT (Excl. Labor Code) | ₹294 Cr | +23.0% YoY |
| GNPA | 1.38% | +1.4% YoY |
| RoA | 4.4% | — |
| Cost-to-Income Ratio | 35.4% | -1.4% YoY |
| Net Interest Spread (Exit) | 5.97% | — |
Segment Breakdown
| Metric | Latest | Trend |
|---|---|---|
| AUM(crores) | 30571 | |
| PAT(crores) | 266 | |
| GNPA | 1.38% | |
| Cost-to-Income Ratio | 35.4% | |
| Disbursements(crores) | 1979 | |
| Cost-to-Income | 36.1% |
| Category | Target | Priority |
|---|---|---|
| Volume | AUM→₹30,000 crores | High |
| Margin | Credit Cost→25 bps | High |
| Margin | Interest Rate Cut→15 bps | High |
| Other | GNPA→1.1% to 1.15% | Medium |
| Capacity | Branch Expansion→40 to 50 branches | High |
| Severity | Risk |
|---|---|
low | Implementation of New Labor Code Impacted the quarter with a one-time past service cost of ₹16 crores. Management |
medium | Competitive Intensity in Affordable Housing Management argues that their focus on low-income segments (ticket size <₹15 lakhs) and deep-impact locations (450+ branches) sees significantly less competition than the 'prime' affordable segment. Analyst |
low | Geographic Stress (Punjab) Punjab is still struggling to recover from flood situations, leading to slightly lower growth in that specific state. Management |
Areas of Evasion(1)
Aadhar is on track to cross the ₹30,000 crore AUM mark by the end of FY26, supported by a 20% YoY growth rate. Management highlighted that January 2026 performance is already exceeding December levels, giving them high confidence in meeting year-end targets. The growth is well-distributed, with no single state contributing more than 15% to the total AUM.
Asset quality showed meaningful improvement, with GNPA at 1.38% and 1+ DPD improving by 31 bps sequentially to 6.86%. Management expects GNPA to settle between 1.1% and 1.15% by the end of the fiscal year. Collection efficiency remains robust at over 99%, and Stage 2 assets improved by 20 bps, indicating lower slippage risk into Stage 3.
Following RBI rate cuts, Aadhar's ALCO decided to pass on a 15 bps rate cut to customers starting February 2026. Despite this, management expects exit spreads to remain healthy at approximately 5.8%, which is an improvement over the previous year. This is possible due to the company's diversified borrowing profile and the reduction in incremental borrowing costs to 7.5%.
The company is positioning itself as a leader in the PMAY 2.0 scheme, with over 10,000 customers already receiving interest subsidies. Management believes the renewed program is significantly improving affordability for first-time homebuyers in the EWS and LIG segments. The turnaround time for subsidy processing through NHB is currently 2-3 working days.
The cost-to-income ratio improved to 35.4%, and management aims for a further 50 bps reduction for the full year. The branch expansion strategy remains aggressive yet calibrated, with a plan to add 40-50 branches annually. Currently, 450 out of 621 branches are in 'emerging' locations where competitive intensity is lower than in urban centers.