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    Bajaj Housing Finance Q1 FY27 earnings call

    BAJAJHFL
    Financial Services·29 Jul 2026
    Management Summary

    Bajaj Housing Finance Limited reported a strong Q1 FY27, marked by robust AUM and disbursement growth, and a 23% YoY increase in PAT. The company maintained resilient asset quality and improved operating efficiency. However, NIM experienced a sequential decline and is expected to moderate further in FY27 due to yield compression, driven by portfolio attrition and competitive acquisition pricing.

    Highlights

    5

    • Highest ever quarterly AUM growth of INR 8,918 crores in Q1 FY27, compared to INR 5,736 crores in Q1 FY26.

    • Disbursements grew 33% YoY to INR 19,509 crores, with AUM up 24% YoY.

    • PAT grew 23% YoY to INR 715 crores from INR 583 crores in Q1 FY26.

    • Opex to net income improved from 21.2% in Q1 FY26 to 19.6% in Q1 FY27.

    • Asset quality remained resilient with GNPA at 29 bps and NNPA at 12 bps, and annualized credit costs at 5 bps.

    Concerns

    3

    • NIM dropped by 14 bps sequentially from 3.8% to 3.7% in Q1 FY27.

    • Expected NIM moderation of 20-25 bps during FY27 from FY26 levels due to yield compression.

    • LAP GNPA inched up from 46 bps to 62 bps in Q1 FY27 due to movement of one week account.

    Key financials

    Single quarter

    17 metrics
    1. 01AUM₹1.50L Cr+24%YoY
    2. 02Quarterly AUM Growth₹8,918 Cr
    3. 03Disbursements₹19,509 Cr+33%YoY
    4. 04PAT₹715 Cr+23%YoY
    5. 05ROA (Annualized)2.3%

    Segment breakdown

    AUM GrowthPortfolio Mix
    Home Loans20%54.1%
    LAP22%10.3%
    LRD41%23.1%
    Developer Finance19%11.4%
    Heatmap· 2 shared metrics

    Capital allocation

    1
    high confidence
    CategoryHeadline
    Liquidity

    Liquidity disclosed

    Capital Adequacy Ratio (CAR) stood at 21.59% in Q1 FY27, above regulatory limits. Leverage levels are expected to fluctuate between 5.8 to 6.3 times, with the company already close to 5.8 and likely reaching around 6.1 by year-end.

    Guidance & targets

    8
    CategoryTargetPriority
    Profitability
    NIM
    moderate by 20-25 bps
    		Medium
    Profitability
    Opex to Net Income
    19% to 20%
    		Medium
    Profitability
    ROA (Annualized)
    2.1% to 2.3%
    		Medium
    Profitability
    ROE (Annualized)
    12.5% to 13%
    		Medium
    Asset Quality
    GNPA
    30-35 bps
    		Medium
    Asset Quality
    Credit Costs
    10-15 bps
    		Medium
    Capital Adequacy
    Leverage levels
    5.8 to 6.3 times
    		Medium
    Volume
    Sambhav Disbursements
    INR 600 crores plus
    		High

    What to watch in Q2 FY27

    5

    BT-out pressure trend

    one more quarter
    Currentsome moderation in the BT-out pressure on the home loan side
    Targetwhether it is a trend

    Why it matters

    To assess if the moderation in BT-out pressure is a sustained trend, which could impact AUM growth and overall portfolio performance.

    While in Q1 there has been some moderation in the BT-out pressure on the home loan side, but we are right now cautiously watching whether it is a trend or we estimated it to go down from Q1 FY27. As of now in Q1, it is looking at. it is moderated a bit from Q4, but we will watch for one more quarter for us to see that it is a trend which can then result into a higher AUM growth.

    Risks & concerns

    3
    RiskSeverity

    Geopolitical factors, inflation, and volatile borrowing costs

    Various geopolitical factors, inflation impact, and volatile borrowing cost movements were observed in Q1 FY27. — Management acknowledged

    medium

    Moderation in BT-out pressure on home loans

    Some moderation in BT-out pressure on home loans was seen in Q1, and the company is cautiously watching if this becomes a sustained trend. — Management acknowledged

    medium

    Competitive intensity and pricing pressure

    Competitive intensity in the market for new acquisitions remains high, leading to some pricing movement and contributing to expected yield compression. — Management acknowledged

    medium

    Q&A highlights

    8

    “NIM moderation 20-25 bps what we are calling out, largely coming from the yield part, because like I called out, what happens both the answers, the second question what you had said, limited upward pricing and the yield.”

    Clarifies that the primary driver of NIM compression is yield compression from portfolio attrition and new lower-IRR acquisitions, rather than solely rising cost of funds.

    asked by Abhijit Tibrewal

    2 min read7 chapters

    Detailed Narrative

    01

    Q1 FY27 Performance Overview

    Bajaj Housing Finance Limited reported a strong Q1 FY27 with the highest ever quarterly AUM growth of INR 8,918 crores, compared to INR 5,736 crores in Q1 FY26. Disbursements grew 33% YoY to INR 19,509 crores, contributing to a 24% YoY AUM growth. PAT increased by 23% YoY to INR 715 crores, while annualized ROA remained stable at 2.3% and ROE improved to 12.5%.

    02

    AUM and Product Segment Growth

    The company's AUM reached INR 1.496 lakh crores in Q1 FY27. Product-wise, home loans grew 20%, LAP grew 22%, LRD grew 41%, and developer finance grew 19%. The portfolio composition remained well-diversified, with home loans at 54.1%, LAP at 10.3%, LRD at 23.1%, and developer finance at 11.4%.

    03

    Cost of Funds and Margins

    Cost of funds moderated by 7 bps sequentially to 7.2% in Q1 FY27 from 7.3% in Q4 FY26. Despite a stable gross spread of 1.7%, NIM dropped by 14 bps from 3.8% to 3.7% in Q1 FY27. Management expects NIM to moderate by 20-25 bps during FY27 due to yield compression from portfolio attrition and competitive acquisition pricing.

    04

    Asset Quality and Provisioning

    Asset quality remained resilient with GNPA at 29 bps and NNPA at 12 bps in Q1 FY27. Annualized credit costs were significantly lower at 5 bps, compared to 15 bps in Q1 FY26, primarily due to a one-off📎 assignment of INR 2,300 crores which released Stage 1 provisioning. The provisioning coverage ratio for Stage 3 stood at 58.5%. LAP GNPA inched up to 62 bps from 46 bps due to a single account movement.

    05

    AI Initiatives for Efficiency and Customer Experience

    The company is deploying several AI initiatives to enhance internal controllership, efficiency, and customer experience. These include a voice agent for lead generation, credit personal discussion call intelligence, collateral assessment intelligence, geo-analytics, AI customer assist platform, training platform, and AI interview agent for frontline hiring. These initiatives aim to improve conversion, evidence-based underwriting, reduce collateral risk, and provide round-the-clock support.

    06

    Sambhav Housing Business Update

    The Sambhav Housing business continues to progress well, with monthly disbursement run rates of INR 450-465 crores in Q1, up from INR 410-425 crores in Q4. The average ticket size remains stable, with affordable housing (ticket size around INR 18 lakhs) constituting 33-36% of the mix. The business is operational in 73 urban and 72 rural locations, targeting over INR 600 crores in disbursements in the next 9 months.

    07

    Management Outlook for FY27

    For FY27, management expects the home loan industry to grow 9-10.5%. NIM is projected to moderate by 20-25 bps from FY26 levels. Operating efficiency (Opex to Net Income) is estimated to be 19-20%. Asset quality is expected to remain healthy with GNPA of 30-35 bps and credit costs of 10-15 bps. Annualized ROA is assessed at 2.1-2.3%, and ROE at 12.5-13%, with leverage levels likely to be 5.8-6.3 times.

    This is an AI-generated summary of a publicly available earnings call transcript.