Housing Finance company Aavas Financiers announced Q1FY25 results: Financial Highlights: AUM of Rs 178 billion; Growth of 22% YoY PAT at Rs 1.26 billion; Growth of 15% YoY Gross Stage 3 at 1.01%; 1 DPD at 3.65% ROA at 3.01% and ROE at 13.14% Positive ALM & Strong Capital Base Business Highlights: Assets under Management (AUM) of the company grew by 22% YoY and stood at ~Rs 178 billion. Disbursement during the quarter was Rs 12.11 billion i.e., a growth of 13% YoY. Net Profit grew by 15% YoY to Rs 1.26 billion for Q1FY25 boosted by a 10% YoY growth in Net Total Income, coupled with strong AUM growth. Opex declined sequentially by 4% resulting in an improvement in Opex ratio by 29bps QoQ to 3.27% during the quarter. Spread and NIM during the quarter stood at 5.00% and 7.31%, respectively. In Q1FY25, Gross Stage 3 is at 1.01% and Net Stage 3 is 0.72%. 1+ DPD remained well below 4% at 3.65%. Credit cost during the quarter was at 20 bps. In terms of Borrowings mix, 91.4% of our borrowings are from Term Loans, Assignment, and NHB Refinancing, 8.6% of our borrowings are from debt capital market (of which 77.2% is from development finance institutions like IFC, CDC & ADB), with no borrowings through CPs. Net Worth grew by 15% YoY to Rs 39 billion as on 30th June 2024. The total number of branches stands at 371 as on 30th June 2024. During Q1 FY25, we have added 4 new branches. Commenting on the performance Sachinder Bhinder, Managing Director & Chief Executive Officer, said: “Dear All, India stands on the cusp of a remarkable economic journey, and the housing sector is poised to lead the charge. With low mortgage penetration and a significant urban housing shortage across various income levels and regions, Aavas is committed to being at the forefront of this industry transformation. Our focus remains steadfast on serving the unserved, underserved, and underbanked customers in Tier 2 to Tier 5 markets, with a relentless pursuit of risk-adjusted returns. The green shoots of our technology transformation are already evident, with improvements in turnaround time (TAT) enhancing customer service. This tech-led evolution is expected to further boost productivity and efficiency across the organization. Our network has expanded to 371 branches across 13 states, with the addition of 4 new branches this quarter. This strategic expansion deepens our footprint and reinforces our presence in a contiguous manner. Thanks to prudent cash management and a robust liability profile, we have successfully contained borrowing costs and maintained our spreads around 5%, in line with our guidance. Aavas is wellcapitalized, boasting a Capital to Risk (Weighted) Assets Ratio (CRAR) of 44.48% as of June 2024. Our granular underwriting practices and collection efforts, backed by cutting-edge technology, have led to an improvement in 1+ days past due, decreasing from 3.68% in June 2023 to 3.65% in June 2024. The portfolio’s health remains robust, with Gross Stage 3 at a mere 1.01% in June 2024. The FY25 Union Budget marks a transformative leap in addressing India’s housing needs by significantly expanding the Pradhan Mantri Awas Yojana to include 30 million Additional Houses, backed by a proposed central assistance of Rs.2.2 trillion over the next 5 years, underscoring the Government of India’s commitment to providing “Housing For All”. The introduction of an interest subsidy scheme for urban housing will make loans more accessible for the economically weaker sections and low-income groups, enabling countless individuals to realize their dreams of home ownership. This decisive step forward underscores the Government’s commitment to ensuring every Indian has access to safe, affordable housing, fostering inclusive growth and prosperity for all. This aligns perfectly with the mission and vision of Aavas. We continue to maintain a razor-sharp focus on Governance, Asset Quality, Profitability, and Growth. By leveraging technology and creating superior customer experiences, we are optimistic about the future. Our strategic initiatives are set to drive sustainable growth and enhance shareholder value.” Result PDF