Whalesbook
📉 The Financial Deep Dive
The Numbers:
Aptus Value Housing Finance India Limited announced strong financial results for Q3 FY26. Assets Under Management (AUM) reached ₹12,330 Cr, growing an impressive 21% year-on-year (YoY). Total Income for the quarter stood at ₹569 Cr, up 22% YoY, while Net Profit saw a significant 26% YoY increase to ₹239 Cr. For the nine-month period ending FY26 (9M FY26), Total Income grew 27% YoY to ₹1,652 Cr, and Net Profit increased 26% YoY to ₹685 Cr.
The Quality:
Profitability metrics remain robust and industry-leading. Return on Assets (RoA) stood at 7.9% for Q3 FY26, and Return on Equity (RoE) was 20.2%. For the nine-month period, RoA was 7.9% and RoE was 20.0%. The company successfully improved its spreads to 8.9% in 9M FY26, aided by a decline in the cost of funds to 8.4%. Operating expenses (Opex) as a percentage of assets were kept under control, remaining stable at 2.7% for both Q3 and 9M FY26. Credit costs for 9M FY26 were at 50 bps, within guidance. A one-off cost of ₹3.85 Cr (net of tax ₹2.99 Cr) related to the new labour code was incurred and excluded from reported Net Profit.
Asset quality metrics showed Gross Non-Performing Assets (GNPA) at 1.6% and Net Non-Performing Assets (NNPA) at 1.2% for Q3 FY26. However, 30+ days Past Due (DPD) saw a slight increase to 6.48%, attributed to seasonal collection volatility.
The Grill:
While no direct 'grilling' was evident in the provided text, management commentary highlighted strategic shifts. The discontinuation of sanctions below ₹7 lakh signals a deliberate move towards a higher-ticket segment, aiming to enhance portfolio quality. Mr. P. Balaji, Managing Director, emphasized the company's focus on technology and data-led decisioning, with over 92% of agreements and 94% of collections being digital.
🚩 Risks & Outlook
Specific Risks:
The primary risk highlighted is the potential impact of seasonal volatility on collections, which led to a slight uptick in 30+ DPD. However, the company appears to manage this through prudent portfolio oversight.
The Forward View:
Aptus Value Housing Finance has a clear growth trajectory. Management expects to close FY26 with 20-21% AUM growth and forecasts sustainable AUM growth of 22-24% moving forward. Key growth drivers include expanding its network (currently 335 branches, adding 37 in CY25), augmenting channels, increasing the Average Ticket Size (ATS), and maintaining calibrated lending rates. The strategic shift towards higher-value loans is expected to bolster portfolio quality and long-term value creation. Investors should monitor the successful execution of network expansion and the impact of the higher-ticket strategy on asset quality and profitability.