Indiabulls Housing Finance's (IHFL) core operating performance wasro bust. AUM grew strongly by 34% YoY to INR1.23t v/s our expectation of INR1.17t. A decline in reported spreads (-13bp YoY), an increase in leverage, and moderation in liquid money-related income led to 22% NII growth. Tax rate was at 18% for the quarter. Disbursements for the quarter were up 30% YoY to INR195b, driven by50%+ YoY growth in core home loans. This drove 34% AUM growth. Management cited strong traction in affordable housing finance. We expect IHFL to continue delivering 25-30% AUM growth over the medium term. Loan mix and borrowing mix both were steady. Yield on loans was down~80bp YoY, while CoF was down ~65bp. IHFL increas edits PLR by 20bp on 1st April 2018. Hence, we expect the impact of rising GSec yields to be somewhat mitigated.