Aadhar Housing Finance presents a compelling investment case, underpinned by its strong growth trajectory, stable asset quality, and prudent risk management practices.
The company reported strong performance in Q4 FY26 and FY26, with assets under management (AUM) rising 20% YoY to Rs 30,571 crore and disbursements growing 16.6% YoY to Rs 9,556 crore, reaffirming its full-year guidance despite seasonal softness.
The assets under management (AUM) recorded a 20% CAGR over the FY22–FY25 period, rising consistently from Rs 14,778 crores in FY22 to Rs 25,531 crores in FY25.
Its diversified retail secured book, comprising 73% home loans and 27% loan against property (LAP), coupled with an average ticket size of Rs 10.9 lakh and conservative loan-to-value (LTV) ratio of 60%, ensures resilience and sustainability of growth.
Gross NPA (GNPA) at the end of FY26 stood at of 1.08%, indicating prudent underwriting and robust risk management.
Majority of portfolio is salaried customers (55% of AUM), which typically ensures more stable repayment behavior compared to self-employed segments.
Home Loans form a significant portion of the book, with 65% exposure to salaried borrowers, providing resilience and lower credit risk.
Loan Against Property (LAP) contributes 35% salaried exposure, balancing yield and risk.
For FY26, Asset quality remains well-managed, with gross NPAs at 1.08% and net NPAs at 0.8%, supported by strong collection efficiency of 99.8% and improving delinquency trends in stressed micro-markets.
On the funding side, borrowings stood at Rs 18,744 crore (+20% YoY) with a diversified mix, liquidity buffer of Rs 2,400 crore, and cost of funds at 7.7%, expected to improve further.
Strategic initiatives such as expansion under the “urban and emerging” branch strategy, retention efforts for reducing balance transfers, and technology upgrades through TCS-enabled systems and AI/ML adoption further strengthen competitive positioning.
Aggressive branch expansion plan of ~50 new branches every year, supporting consistent growth in customer acquisition and geographical reach. This expansion underpins scalability and strengthens presence in underpenetrated markets.
Additionally, favorable policy tailwinds from GST 2.0 and PMAY 2.0, coupled with management’s disciplined stance against rate undercutting, provide a supportive macro environment.
Overall, Aadhar Housing Finance combines scale, geographic diversification, stable asset quality, and strong profitability with clear growth visibility.
