Aadhar Housing Finance Ltd held its Q2 FY27 earnings call on November 05, 2026. Here's a quick read of what management said — performance, strategy, and the outlook ahead.
Strong Quarter with Double-Digit Growth Across Core Metrics
AUM of Rs.32,643 crore as of 30 September 2026, up 18% YoY; on a like-to-like basis (after the Q1 FY27 shift to cheque-clearance disbursement recognition), H1 FY27 AUM growth was 20% YoY.
Q2 FY27 disbursements of Rs.2,577 crore, up 22% YoY; H1 FY27 like-to-like disbursement growth of 21% YoY.
Q2 FY27 PAT of Rs.308 crore vs Rs.266 crore in Q2 FY26; H1 FY27 PAT of Rs.591 crore vs Rs.504 crore year-ago. Adjusted for ESOP cost, PAT grew 20% in Q2 and 22% in H1 FY27.
Q2 FY27 ROA of 4.2% and ROE of 15.2%; adjusted for ESOP cost, Q2 ROA/ROE were 4.4%/15.8% and H1 ROA/ROE were 4.3%/15.5%.
Cost-to-income of 33.9% in Q2 FY27 (down 230 bps YoY) and 34% in H1 FY27 (down 215 bps YoY), adjusted for an ESOP charge of Rs.14 crore in Q2 (Rs.28 crore in H1 FY27) under the ESOP scheme started January 2026 at Rs.425/share exercise price.
Portfolio mix: home loans 73% / non-home loans 27% of AUM; average ticket size Rs.11.3 lakh; LTV at 61%; salaried segment 55% of AUM.
Headcount of 6,112 employees on roll at 30 September 2026; management reiterated focus on maintaining a healthy book and consistent quarterly performance.
October 2026 disbursement run-rate improved from an average of ~800 to close to ~900 (units not specified in transcript), which management described as numbers "stacking up good."
Minimum 20% disbursement growth guided for Q3 FY 2026-2027; management expects 20%+ disbursement growth in H2 FY 2026-2027 and remains committed to FY 2026-2027 full-year guidance of 18-20% disbursement growth.
Branch guidance of 40-50 new additions for FY 2026-2027 reaffirmed — only 5-6 added so far with ~40 in the pipeline; management stated this commitment stands. Only 4 branches were opened over recent quarters, per the analyst's observation.
Network of 632 branches across 23 states covering over 555 districts as of September 2026, with one branch added in Jammu; expansion is calibrated and demand-based, focused on improving existing-branch productivity.
NHL mix rebuilding: non-home loan share moved from 24% in Q1 FY 2026-2027 to 26% in Q2 FY 2026-2027 after underwriting was tightened in Q4 FY 2025-2026; management expects ~28% by end of Q4 FY 2026-2027, moving to a 70:30 home loan-to-NHL mix in FY 2027-2028.
Geography mix: UP AUM growth of ~9% vs blended ~18% (Q2 FY 2026-2027); CEO Rishi Anand attributed the gap to faster rundown of UP's vintage book, citing disbursement growth of ~23% in UP and ~23-24% in Karnataka.
GNPA improved to 1.34% at 30 September 2026 from 1.42% in Q2 FY26 (an 8 bps YoY improvement); NNPA on AUM flat at 1% YoY; Stage 3 provision coverage ratio at 34.5%.
Q2 FY27 credit cost of 31 bps (vs 41 bps in Q1 FY 2026-2027) overshot the 23-25 bps guided range; CFO Rajesh Viswanathan stressed guidance is an annual number and reaffirmed FY 2026-2027 guidance of 25 bps on assets (~22-23 bps on AUM).
GS2 rose from 3.3% in Q1 FY 2026-2027 to ~3.55% in Q2 FY 2026-2027; management attributed the move to seasonality, said no specific state or market shows a spurt, and noted YoY comparability (3.5% in Q2 FY 2025-2026 vs 3.55%). Kunal Shah (Citi) countered that GS2 fell 20 bps QoQ in Q2 FY 2025-2026 (3.7% → 3.5%) versus a 25 bps rise this quarter.
Headline NPA guidance of 1.10-1.15% by end of FY 2026-2027 reaffirmed, with management confident of clawing back elevated accounts and ending the year at the 25 bps credit cost level.
Segment GNPA: ~1% for home loans and ~2% for non-home loans (blended 1.34%) in Q2 FY 2026-2027, versus 1.2% HL and 2.01% NHL in Q2 FY 2025-2026.
1+ DPD: the ~7% figure was as disclosed in the Q1 FY 2026-2027 call; for September/October of FY 2026-2027, management said the metric is "very flattish" and in a comfortable zone, without an updated number.
BT-out at 5.1% in Q2 FY 2026-2027 (vs 5% in Q1), improved 40 bps YoY; management attributed the QoQ move to seasonality and explicitly declined to link it to increased competition. Industry BT-out hovers around 6.5-7%; a 5-5.5% level was described as very comfortable.
AA+ Upgrade Widens Funding Options; Floating Book Aids Pass-Through
India Ratings and ICRA upgraded the company to AA+ (stable) during Q2 FY27; all three agencies (India Ratings, CARE, ICRA) now rate Aadhar AA+ standalone, strengthening its position to optimize borrowing costs over time, subject to prevailing market conditions.
Future NCD issuances estimated to price ~20 bps cheaper on average versus AA (range 10-30 bps, market-dependent) per CFO Rajesh Viswanathan (period unspecified); the upgrade also opens lender pools such as pension funds and life insurance companies that typically lend only to AA+ borrowers with at least two agency ratings.
Total borrowings of Rs.20,400 crore at 30 September 2026 vs Rs.17,600 crore at 30 September 2025; mix: banks 53%, NHB 22%, NCDs 15%, ECB 7%, others 3%, across 43 borrowing relationships.
Q2 FY27 incremental borrowings of Rs.1,550 crore at 7.5%; no fresh NHB drawdown during Q2; exit cost of funds at 7.7% and exit portfolio yield at 13.4%, with exit spread at 5.73%.
~75% of both assets and liabilities are floating rate as of Q2 FY 2026-2027; the RPLR model — described as the "final source of truth" — will drive pass-through in both directions, with spreads expected to be largely insulated apart from a possible one-quarter interim timing lag.
No rate-hike decision as of now: the ALCO meeting is expected in December 2026 or January 2027, contingent on the RBI announcement in January 2027; RBI's recent policy raised the repo rate by 25 bps to 5.5% with a shift toward calibrated tightening.
Liquidity of Rs.2,040 crore at end of Q2 FY27 with undrawn sanctions of Rs.1,466 crore; a fresh Rs.1,000 crore sanction was received from National Housing Bank in the week of the call (post-Q2 FY27).
El Niño Exposure Contained; NHB Outlay and IRDA Rules Unresolved
El Niño exposure limited: of ~88 high-priority districts under El Niño, Aadhar is present in only 30, covering ~5-6% of AUM (as of Q2 FY 2026-2027); the risk team monitors EMI bounce as first line of defense, currently completely stable. Management is also mindful of geopolitical developments affecting semi-urban borrowers' cash flows.
LAP agri exposure underwritten conservatively: the credit policy caps any customer's income from agri or other oblique/seasonal sources at 25%, requiring 75% from other business and regular flow income; a 55% FIR is applied on such customers (corrected from an initial 45%). Management could not quantify the agri-exposed share of the LAP book but said it is "very comfortably positioned."
NHB affordable housing outlay: MD & CEO Rishi Anand said there is no circular from NHB as yet on an increased outlay and the company will "leave media reports to media"; management has been engaging extensively with NHB with indications "very positive," but no number or timeline was attached (period unspecified).
IRDA draft insurance regulations: management said these are still draft guidelines, the entire industry has submitted recommendations, and the company is waiting for final guidelines; once final, it will calibrate using levers such as fee income and OPEX to keep guidance numbers comfortably intact.
Stage-2 movement: no particular geographies showing undue movement in stage 2, and bounce rates show no undue movement across the states the company caters to.
Board Transition, Assignment Volumes on Plan, Encouraging Q3 Start
Board changes: Non-Executive Chairperson Raj Vikas Verma passed away on the 16th of the month; Devshankar Tripathi (previously Executive Vice Chairman) appointed Interim Non-Executive Chairman per regulatory requirements; Nikhil Goyal (Managing Director, Blackstone) joined the board as additional director effective 12 August 2026.
FY 2026-2027 assignment volumes guided at ~Rs.2,000-2,050 crore, in line with plan, vs Rs.1,700-1,800 crore executed in FY 2025-2026; the net impact of fresh assignment income plus unwinding on Q2 FY 2026-2027 profit was only ~Rs.10 crore higher than Q2 FY 2025-2026.
Recognition change quantified: disbursement recognition moved from cheque-handover to cheque-clearance effective 1 April (start of FY 2026-2027); the Q1 impact was ~Rs.350 crore of reduced disbursements, and Q2 FY27 disbursements on the old basis might have been ~Rs.200-250 crore higher (a safer-side anticipation, as no exact figure was tracked). The two bases even out by Q2 FY 2026-2027.
Medium-term guidance of 20% AUM and PAT growth retained, alongside FY 2026-2027 full-year guidance of 20% AUM and PAT growth; management remains confident of delivering full-year FY 2026-2027 guidance despite the GS2 uptick.
Q3 FY 2026-2027 initial trends described as "very encouraging," with management hopeful of delivering a good Q3; CFO Rajesh Viswanathan characterized Q2 FY 2026-2027 as a strong quarter.
Technology and competition: AI and data analytics are leveraged across origination, underwriting, portfolio monitoring, collections and retention, with in-house platforms under construction across document, voice, decisioning, enterprise access and management intelligence; competition is increasing, making new catchment development and customer retention more important.
Next conference call planned for late January/early February 2027, following Q3 FY 2026-2027 results.
Disclaimer: This earnings call summary is published for educational and informational purposes only. It is not investment advice, not a recommendation to buy, sell or hold any security.
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