Aptus Value Housing Finance India Ltd. share price target

We maintain our BUY recommendation on the stock.

We maintain our BUY recommendation on the stock.

Improving trajectory in Aptus Value Housing Finance’s (Aptus) financial performance sustained in Q1FY25, evident in RoE expanding to 18.1%, from 16.9% in Q1FY24.

We maintain our BUY recommendation on the stock.

Recommendation: We maintain our BUY recommendation on the stock.

We maintain our BUY recommendation on the stock.

The highlight of Aptus Value Housing Finance’s (Aptus) Q2FY24 result is its strong credit growth of 11% QoQ, surpassing the sequential growth range of 6-8% during the past 12 quarters and sustaining industry-leading profitability as reflected in >8% RoA and 17% RoE.

Company Outlook: We remain confident in Aptus' ability to deliver consistently strong growth with a focus on strengthening leadership positions in existing core geographies and gradual ramp-up in business in the new geographies and to deliver best-in-class RoA/RoE over the medium term.

RoE expansion journey continued for Aptus Value Housing Finance (Aptus), as reflected in it improving to 16.9% in Q1FY24 (one of the highest within AHFC space) vs 16.3% in Q4FY23 and 15.9% in Q1FY23, driven by steady AUM growth (up 6% QoQ). It reported PAT of INR 1.4bn (up 20% YoY / 5% QoQ) driven by a sharp decline in credit cost to 14bps vs 48bps QoQ and 8% QoQ reduction in staff cost.

We recommend a BUY rating on the stock with a TP of Rs 303, implying an upside of 10% from CMP.

We met Aptus Value Housing Finance’s (Aptus) newly appointed MD Mr. P Balaji and Sales, IT and collection head to get a sense of the underlying business trend in AHFC space and how Aptus is placed to sustain ~30% AUM growth in medium term.

In Q4FY23, Aptus Value Housing Finance (Aptus) announced top management restructuring with – i) appointment of Mr. M Anandan as the Executive Chairman (Chairman & MD earlier), ii) appointment of Mr. P Balaji as the Managing Director (ED & CFO) and iii) appointment of Mr. John Vijayan Rayappa as the Chief Financial Officer (CRO earlier).

We maintain our BUY recommendation on the stock.

Aptus Value Housing Finance’s (Aptus) Q3FY23 earnings at Rs1.26bn (up 24% YoY / 2% QoQ) (translating into 8.5% RoA and >15% RoE) were a tad lower than I-Sec estimate of Rs1.3bn. Disbursements were flat QoQ at Rs6.05bn and up 33% YoY, which supported AUM growth of 31% YoY and 6% QoQ to Rs63.1bn.

We maintain our BUY recommendation on the stock.

We maintain our BUY recommendation on the stock with a target price of Rs 350/share (4.8x FY24E ABV), implying an upside of 15% from the CMP.

Aptus Value Housing Finance’s (Aptus) Q2FY23 earnings at Rs1.23bn (up 45% YoY/ 4% QoQ), translating into 8.7% RoA and 15.8% RoEs, was exactly in line with I-Sec estimates.

We broadly maintain our FY23-24E estimates and maintain our BUY recommendation on the stock with a target price of Rs 350/share (4.5x FY24E ABV), implying an upside of 21% from the CMP.