Aadhar Housing Finance Limited Q1 FY25 Earnings Conference Call Summary
Key Executives Present
• Executive Vice-Chairman: Deo Shankar Tripathi
• MD and CEO: Rishi Anand
• CFO: Rajesh Viswanathan
Financial Highlights
• Assets Under Management (AUM): Increased by 21% YoY to INR 21,726 crores.
• Loan Book Quality: Collection efficiency above 99%.
• Total Borrowings: INR 14,000 crores, up from INR 13,950 crores.
• Profit After Tax (PAT): Increased by 37% to INR 200 crores.
• Return on Equity (ROE): 4.1%.
• Gross Non-Performing Assets (NPA): Improved to 1.31%.
Growth and Expansion Plans
• Disbursement Growth: Expected at 18%-20%.
• New Branches: Plans to add 75 branches in the next couple of years.
• Incremental Ticket Sizes: INR 13 lakhs for housing loans, INR 8.2 lakhs for non-housing loans.
Strategic Initiatives
• Focus on Affordable Housing: Commitment to low-income segments and technology enhancements.
• New Independent Director: Dr. Punita Kumar Sinha introduced.
• Risk Management: Adjustments to comply with RBI guidelines on Loan Against Property (LAP).
Market Insights
• Credit Linked Subsidy Scheme (CLSS): Anticipated to encourage 8-10% of hesitant customers to take home loans.
• AUM Distribution: Maharashtra and Uttar Pradesh are the largest contributors, with a goal to limit AUM in any single state to 15%.
Operational Efficiency
• Cost-to-Income Ratio: Target to reduce by 75 to 100 basis points.
• Employee Attrition: Reported at 35%, with a regret attrition rate of 18%.
Future Outlook
• Long-term AUM Growth Guidance: Projected at 22-23% for the current year and 20-21% over the next three years.
• Portfolio Yields: 13.06% for home loans and 16.9% for non-home loans.
Conclusion
• Management expressed confidence in sustaining growth and improving asset quality while focusing on economically weaker sections.

Aadhar Housing Finance Limited Earnings Conference Call Summary
Submission and Compliance
• Transcript submitted to BSE and NSE on June 4, 2024.
• Call held on May 30, 2024, with key management members present.
• Transcript available on the company's website.
• Signed by Harshada Pathak, Company Secretary and Compliance Officer.
IPO Highlights
• First post-listing call after successful IPO on May 15, 2024.
• IPO subscription at 26.8 times, raising INR 3,000 crores.
• Focus on housing finance for economically weaker sections (EWS) and lower-income groups (LIG).
Financial Performance Overview
• Total borrowings: INR 13,960 crores, diversified mix (55% banks, 25% NHB, 20% NCDs).
• Profit after tax: INR 750 crores, 33% growth year-on-year.
• Gross Non-Performing Assets (GNPA): Improved to 1.08%.
• AUM growth target: 20%, with plans to expand in smaller towns.
Key Financial Metrics
• Cost of funds for FY'24: 7.6%, increased to 7.7% in Q4.
• Current cost-to-income ratio: 37.5%, with a goal to reduce by 50-60 basis points next year.
• Spreads expected to remain around 5.8% to 5.9%.
Customer Demand and Loan Disbursement
• Anticipated minimal impact on customer demand from recent rate increases.
• Q4 typically challenging for disbursement growth.
• Home loans average ticket size: INR 13.7-13.9 lakhs; non-home loans: INR 8.3-8.5 lakhs.
Future Plans and Strategies
• Plans to open approximately 75 new branches in FY '25.
• Focus on customer retention to reduce balance transfer out rate (currently 6.9%).
• Emphasis on educating customers about insurance products.
Self-Employed Customer Segment
• Higher NPAs (90-100 basis points) compared to salaried customers, offset by higher risk-adjusted yields.
• Underwriting process includes thorough assessments of cash flows and property visits.
Conclusion
• Management expresses optimism about future growth and performance post-IPO.