Aptus Value Housing Finance India Limited — Q3 FY26 earnings call

Call held 5 Feb 2026

Management summary

Aptus Value Housing Finance reported a strong Q3 FY26, with AUM growing 21% YoY to INR12,330 crores and Net Income Margin up 26% YoY. Profitability metrics like ROE (20.2%) and ROA (7.9%) remained robust. The company is focusing on sustained AUM growth of 22-24% through branch expansion, increased average ticket size, and calibrated pricing, despite a conscious pullback from loans below INR7 lakhs. Asset quality remained largely stable, though a slight uptick in DPD and SME NPAs was noted, with management confident in controlling it by Q4.

Highlights

  • AUM grew 21% YoY to INR12,330 crores from INR10,226 crores as of December 31, 2025.

  • Disbursements for Q3 FY26 grew 11% YoY to INR1,030 crores.

  • Net Income Margin grew 26% YoY to INR406 crores, with spreads improving to 8.9% and cost of funds declining to 8.3%.

  • ROE sustained above 20.2% and ROA at 7.9%, indicating healthy profitability.

  • Credit cost for 9M FY26 remained within the guided range at 50 basis points.

Concerns

  • Slight uptick in 30-plus DPD to 6.48% due to seasonal volatility in collections.

  • Slight uptick in NPA of SME loans, which will be focused on and controlled in Q4.

  • AUM growth target of INR25,000 crores by FY29 might be delayed by 1-2 quarters due to market conditions and strategic shifts.

Key financials

3 periods

Headline

  • AUM
    ₹12,330 Cr
    YoY +21%
  • Net Income Margin
    ₹406 Cr
    YoY +26%
  • Spreads
    8.9%
  • Cost of Funds
    8.3%
  • ROE
    20.2%
  • ROA
    7.9%
  • Gross NPA
    1.6%
  • Net NPA
    1.2%
  • Opex as % of AUM
    2.7%

Q3 FY26

  • Disbursement
    ₹1,030 Cr
    YoY +11%

9M FY26

  • Credit Cost
    50 bps

What they filed

Q1 FY27: revenue up 15.4%, net profit up 19.2% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue421 450 484 520 544 +29%554 +23%574 +19%600 +15%
EBITDA353 383 409 439 453 +28%455 +19%— —
Net profit182 190 207 219 227 +25%236 +24%261 +26%261 +19%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Capital allocation

high confidence
  • Liquidity Undrawn ₹1,387 Cr Total liquidity of INR1,877 crores as of December, including INR1,387 crores of undrawn bank sanctions, providing ample headroom to support growth.
    We continue to maintain a strong liquidity position with a total liquidity of INR1,877 crores as of December, including INR1,387 crores of undrawn bank sanctions, providing us ample headroom to support growth.

Guidance & targets

AUM Growth

  • Sustainable AUM growth AUM Growth · future · High confidence 22-24%
    Looking ahead, we expect to deliver sustainable AUM growth of 22% to 24%, driven by the above initiatives.

    — P Balaji

Branch Expansion

  • Branch openings Branch Expansion · FY26 · High confidence 40
    In FY '26, we have planned 40 branch openings, most of which are already operational.

    — P Balaji

  • Branch openings Branch Expansion · next financial year · High confidence 60-70
    For the next financial year, we plan to accelerate expansion to 60 to 70 branches.

    — P Balaji

Opex

  • Opex as % of AUM Opex · going forward · Medium confidence 2.8%

    Previously 2.7% → 2.8%

    But still, if you look at our cost of opening branches or running a branch, it is the bare minimum, so in the sense that the basic facilities are provided and we are concentrating more on the productivity of the people. So because of that, we were we believe that this 2.7% may slightly go up to 2.8%, but it might not be substantially very high.

    — P Balaji

Credit Cost

  • Credit cost Credit Cost · FY27 · High confidence 0.5%
    See, actually, yes, we have been guiding a credit cost of 0.5%, and we reiterate that, that will be maintained. I mean, this is despite the aggressive write-off policy which we are following, and this will be maintained. So going forward also, you can factor in 0.5% credit cost in all the models which you're developing.

    — P Balaji

AUM

  • AUM target AUM · FY29 · Medium confidence INR25,000 crores
    But having said that, having guided at 22% to 24%, that achieving this INR25,000 crores AUM by FY '29 might get delayed by one quarter or two quarters.

    — P Balaji

What to watch in Q4 FY26

Control of SME loan NPAs

Q4 FY26
Current Slight uptick in NPA of SME loans
Target Controlled in Q4

Why it matters

To ensure asset quality stability and prevent further deterioration in a specific segment.

There is also a slight uptick in the NPA of SME loans, which will be focused and controlled in Q4.

Risks & concerns

  • Seasonal volatility in collections leading to higher DPD

    medium

    30-plus DPD saw a slight uptick to 6.48% due to seasonal volatility in collections because of the festive periods.

    30-plus DPD saw a slight uptick to 6.48% due to seasonal volatility in collections because of the festive periods.

    Management acknowledged

  • Uptick in NPA of SME loans

    medium

    There is also a slight uptick in the NPA of SME loans, which will be focused and controlled in Q4.

    There is also a slight uptick in the NPA of SME loans, which will be focused and controlled in Q4.

    Management acknowledged

  • Competition in human resources at branch level

    medium

    Competition is more disturbing in human resources, with attrition at the branch level from existing and new NBFCs/HFCs.

    But our own experience, more than the competition from the demand perspective, we see particularly the competition is more disturbing in human resources. We are seeing at a closer quarters' competition in terms of our HR resources at the branch level from the existing and the new NBFCs, housing companies'.

    Management acknowledged

  • Impact of rate reduction on yields

    low

    Rate reduction of 50-75 bps on incremental home loans is only for housing loans and incremental customers, impact on spreads/NIMs likely minimal, less than 10 bps on consolidated loan book.

    On the consolidated loan book, the impact of this rate reduction on our yields is less than 10 basis points.

    Management downplayed

Q&A highlights

5 direct
Impact of discontinuing smaller-ticket loans (<INR7 lakhs) Direct
So if you look at it -- if your look at the disbursements of this less than INR7 lakhs in the first nine months of the FY'25, it was around INR432 crores. And in the first quarter of this year, we had done INR148 crores. After that, we took a decision to stop this less than INR7 lakhs, so which means there is a difference of INR283 crores, which needs to be built or added to the disbursements, which we have done now. So, that is the difference, and that is the number on the disbursements basically.

Clarifies the quantitative impact of a strategic decision to exit a loan segment on past and future disbursements and its current proportion of AUM.

Asked by Kunal Shah

Outlook on Opex to Assets ratio given branch expansion Direct
But still, if you look at our cost of opening branches or running a branch, it is the bare minimum, so in the sense that the basic facilities are provided and we are concentrating more on the productivity of the people. So because of that, we were we believe that this 2.7% may slightly go up to 2.8%, but it might not be substantially very high.

Addresses concerns about rising operating expenses due to aggressive branch expansion and IT investments, providing a revised outlook for the Opex ratio.

Asked by Kunal Shah

Asset quality trends in Andhra Pradesh and Telangana Direct
If you look at Andhra Pradesh, there is a growth of 23%, and so basically, because it is less than INR7 lakhs loans got impacted there more, and because of that, there is a growth slightly coming down there. But going forward, people have been informed about our strategy at the ground level in the state of Andhra Pradesh. And in fact, we have seen good amount of ATS increase in the month of December because of this. And this will continue to go in the -- continue in the fourth quarter and in the coming years in Andhra Pradesh.

Explains the impact of the strategic shift on AUM growth in key states and outlines the path to recovery through increased ATS.

Asked by Varun Palacharla

Competitive landscape and strategy in new states Direct
So first, let me address this question on Odisha and Maharashtra. See, we have taken some 2 years from FY '24, we started the branches. And in 2 years, we have been studying the market. We are now confident of growing the book there. So with that in mind, we have opened more branches in this quarter, so I think 8 branches in Orissa, 9 branches in Maharashtra. Earlier, it was only 5 each. So we'll be opening more branches as well in the coming years. And we'll end the year with 10 branches in Odisha and Maharashtra.

Details the company's expansion strategy in new geographies and their confidence in growing the loan book there, while also acknowledging competition in core states like Tamil Nadu.

Asked by Shailesh Kanani

MSME asset quality issues and control measures Direct
There was a slight increase in the bounce rate as well in the Q3, and that has not come down. But we will have this additional efforts for collecting these monies in the MSME segment because again, if you look at it, the product is the same. Again, it is secured by the self-occupied residential property. The LTV is 35%, 40%. The instalment-to-income ratio is currently maintained at 50%.

Management acknowledges a slight deterioration in MSME asset quality but provides reassurance on control measures and inherent portfolio strengths (LTV, IIR).

Asked by Rajiv Mehta

Consistency of AUM growth guidance and FY29 target Partial
So basically, if you look at, see that is the reason we have also given a slightly lower growth, if you look at our guidance, which is between 22% to 24%. And it is because of this; we have moved away from the less than INR7 lakhs. That has slightly moderated the disbursement growth in this year.

Analyst challenges the changing growth guidance, and management explains it's due to market conditions and strategic decisions (like exiting <INR7 lakhs loans), prioritizing book quality over strict adherence to targets.

Asked by Satyam Kumar

3 min read 6 chapters

Detailed narrative

Robust AUM Growth and Profitability

Aptus Value Housing Finance reported a strong Q3 FY26, with Assets Under Management (AUM) growing 21% year-on-year to INR12,330 crores from INR10,226 crores. Disbursements for the quarter increased by 11% YoY to INR1,030 crores, contributing to a 9% YoY growth in 9M FY26 disbursements to INR2,768 crores. The company maintained healthy profitability, with Net Income Margin growing 26% YoY to INR406 crores, and ROE sustained above 20.2%, positioning it among the highest in the industry.

Strategic Shift from Small-Ticket Loans and ATS Increase

The company consciously pulled back from loans below INR7 lakhs, a segment that contributed INR148 crores in Q1 FY26 and INR432 crores in 9M FY25. This strategic decision, not driven by asset quality concerns but by proactive risk management in MFI and small LAP segments, is expected to result in a 10-11% reduction in current AUM over time. Concurrently, Aptus is increasing its average ticket size (ATS) from INR8-9 lakhs to INR10-10.5 lakhs to attract better quality customers and align with rising construction costs, with minimal impact on overall yields (less than 10 basis points).

Branch Expansion and Geographic Diversification

Aptus is aggressively expanding its physical footprint, planning 40 new branch openings in FY26 (most already operational) and accelerating to 60-70 branches in the next financial year. This expansion is focused on new states like Maharashtra and Odisha, where the company has opened 8 and 9 branches respectively in Q3 FY26, and aims for 10 branches in each by year-end. While these new states currently contribute a small portion (INR109 crores in 9M) to the total AUM, they are expected to drive future growth. In core states like Tamil Nadu, growth is targeted to increase from 15% to 18%.

Stable Asset Quality with Targeted Interventions

Asset quality remained largely stable with Gross NPA at 1.56% and Net NPA at 1.18%. However, a slight uptick in 30-plus DPD to 6.48% was observed due to seasonal volatility, and a minor increase in SME loan NPAs was noted. Management is confident in controlling these issues by Q4 FY26, leveraging strong MIS and existing cushions like 35-40% LTV and 50% installment-to-income ratio. The credit cost for 9M FY26 remained within the guided range at 50 basis points, with a reiteration of 0.5% guidance for FY27.

Optimized Funding and Cost of Funds

The company raised approximately INR902 crores in Q3 FY26 through NCDs, term loans, and securitization, maintaining a diversified liability profile (59% banks, 11% NHB, 17% NCDs). The cost of funds declined to 8.3% over the last four quarters from 8.7%. Ongoing treasury efforts include negotiating with banks to reduce interest rates, successfully bringing down rates on some loans from 9.25% to 8.4% and securing new facilities at 7.95%. This optimization contributes to improved spreads and supports calibrated lending rates.

Competition and Human Resources Focus

While the market opportunity is vast, competition is heightened in Tamil Nadu from existing NBFCs/HFCs, small finance banks, and PSU banks. However, competition is less acute in newer states like Odisha and Maharashtra. Management highlighted that the primary competition is in human resources, specifically attrition at the branch level, rather than business or market share. Aptus is piloting a 'connector channel' in Tamil Nadu and Andhra Pradesh as an additional lead generation mechanism to enhance business growth.

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