Aadhar Housing Finance **WOWS** Q2! Profit Jumps 17%, Analysts Say BUY With New Target – Don't Miss Out!

Aadhar Housing Finance Limited announced its second-quarter financial results, surpassing market expectations. The company's Assets Under Management (AUM) saw a robust year-on-year growth of 21% and a 4% quarter-on-quarter increase, indicating steady expansion. Profit After Tax (PAT) demonstrated strong momentum, growing by 17% year-on-year and 12% quarter-on-quarter to ₹270 crore, which was 7% higher than analyst estimates. This outperformance was driven by an improvement in net interest margins by 20 basis points (bps) quarter-on-quarter, attributed to a decline in the Cost of Borrowing (COB). Furthermore, credit costs, measured on average AUM, reduced significantly to 19 bps from 41 bps in the previous quarter, thanks to a decrease in loan delinquency. Management has reaffirmed its AUM growth guidance of 20-22% for Fiscal Year 2026 and expects a stronger pickup in disbursements during the second half of the fiscal year. The outlook for asset quality remains stable with consistently declining delinquency. Despite risks from potential interest rate cycles affecting its 75% floating rate book and increasing competition in the affordable housing sector, analysts remain optimistic.

Impact This positive financial performance is expected to boost investor confidence in Aadhar Housing Finance Limited, potentially leading to an upward movement in its stock price. It also reinforces the positive sentiment around the affordable housing finance segment in India, suggesting strong underlying demand and operational efficiency. Rating: 7/10

Difficult terms: AUM (Assets Under Management): The total market value of assets that an investment company manages on behalf of its clients. For Aadhar Housing, this represents the total value of loans outstanding. PAT (Profit After Tax): The net profit remaining after all expenses, interest, and taxes have been deducted from revenue. bps (basis points): A unit of measure used in finance equal to 1/100th of 1%. For example, 20 bps is equivalent to 0.20%. COB (Cost of Borrowing): The interest expenses a company incurs on the funds it has borrowed. Delinquency: The state of failing to make payments on a loan or debt when it is due. FY (Fiscal Year): A 12-month period used for accounting and financial reporting, which may not align with the calendar year. H2 (Second Half): Refers to the latter half of a fiscal year. P/BV (Price-to-Book Value Ratio): A financial valuation metric that compares a company's current market price to its book value per share. TP (Target Price): The price level at which an analyst or investor expects a stock to trade within a specific timeframe.