AUM
₹7,044 Cr
+27% YoY
Assets under management grew 27% year-on-year, driven by strong disbursement momentum.
AYEFINANCE
Financial Services
2026-04-??
Aye Finance Ltd — Q4 FY26
Aye Finance delivered a strong Q4 FY26, with AUM reaching ₹7,044 crore (up 27% YoY) and disbursements of ₹1,655 crore (up 26% QoQ).
Financial stats pending filing verification
2-Minute Summary
✦ AI-Generated from Full Transcript
Aye Finance delivered a strong Q4 FY26, with AUM reaching ₹7,044 crore (up 27% YoY) and disbursements of ₹1,655 crore (up 26% QoQ). PAT grew 110% YoY to ₹86 crore, driven by improving asset quality and lower credit costs. The net interest margin expanded to 16.4% as cost of borrowings moderated to 10.87%. Management guided for FY27 AUM growth of 25-30%, credit cost of 3.5-4%, and operating expense ratio of 8.25-8.75%. The mortgage loan mix increased to 23% of portfolio, with a target of 30-35% over 2-3 years. Key risk: any sharp rise in interest rates could pressure NIMs despite the priority sector lending buffer.
Key Numbers
Disbursements (Q4)
₹1,655 Cr
+26% QoQ
Quarterly disbursements rose 26% sequentially, reflecting sustained demand from micro-enterprises.
Collection Efficiency (non-OD)
99.5%
+40bps vs Oct'25
Collection efficiency improved from 99.1% in October 2025 to 99.5% in March 2026.
GNPA
4.77%
-17bps QoQ
Gross NPA declined 17 basis points sequentially to 4.77%, reflecting improving asset quality.
What Changed vs Last Quarter
NEW
AUM growth of 25-30% in FY27
Management expects assets under management to grow 25-30% in the current financial year.
NEW
Credit cost guidance of 3.5-4% for FY27
Credit cost is expected to normalize to 3.5-4% in FY27, supported by better portfolio quality.
NEW
Operating expense ratio target of 8.25-8.75% in FY27
Operating expense ratio is expected to decline from 9.6% to 8.25-8.75% by leveraging existing capacity.
NEW
ROA target of 4-4.5% in FY27
Return on assets is expected to be in the range of 4-4.5% for the current financial year.
DROPPED
FY26 AUM growth of 29-30%
Management expects full-year AUM growth of 29-30%, driven by strong Q4 disbursement momentum.
DROPPED
Three-year vision: 30% CAGR, credit cost 3.25-3.75%, ROA 4-4.5%
Over the next three years, the company targets consistent 30% AUM growth, credit cost between 3.25% and 3.75%, and ROA of 4-4.5%.
DROPPED
Q4 FY26 annualized credit cost below 4%
Management expects quarterly annualized credit cost to fall below 4% in Q4 FY26, setting up for FY27.
DROPPED
Mortgage portfolio to reach 30% of AUM over 3 years
The mortgage loan share is targeted to increase from current 21% to 30% of total AUM over the next three years.
NEW RISK
Interest rate hardening could pressure NIMs
Rising interest rates may increase borrowing costs, partially offsetting benefits from lower-cost debt replacement.
NEW RISK
Geopolitical risks from West Asia could impact micro-enterprises
Escalation in West Asia may disrupt local businesses, though management believes their customer segment is insulated.
RISK GONE
Bihar regulatory risk from microfinance ordinance
A new Bihar ordinance on microfinance could impact collections, though management believes business loans are less affected and similar past state regulations had minimal impact.
RISK GONE
Mortgage team costs weighing on opex
The addition of 1,300-1,400 mortgage staff has increased operating expenses; profitability improvement depends on mortgage book scaling to absorb these costs.
RISK GONE
Competition in mortgage lending may pressure yields
Increased supply in the mortgage segment could lead to pricing pressure, potentially offsetting benefits from lower credit costs.
Management Guidance
AUM growth of 25-30% in FY27
Management expects assets under management to grow 25-30% in the current financial year.
Management guidance growthCredit cost guidance of 3.5-4% for FY27
Credit cost is expected to normalize to 3.5-4% in FY27, supported by better portfolio quality.
Management guidance marginsOperating expense ratio target of 8.25-8.75% in FY27
Operating expense ratio is expected to decline from 9.6% to 8.25-8.75% by leveraging existing capacity.
Management guidance marginsROA target of 4-4.5% in FY27
Return on assets is expected to be in the range of 4-4.5% for the current financial year.
Management guidance growthKey Risks
Interest rate hardening could pressure NIMs
Rising interest rates may increase borrowing costs, partially offsetting benefits from lower-cost debt replacement.
medium · management_commentaryCredit cost normalization may be slower than expected
Despite improving collection efficiency, the NPA bulge from earlier slippages could delay credit cost reduction.
medium · analyst_questionGeopolitical risks from West Asia could impact micro-enterprises
Escalation in West Asia may disrupt local businesses, though management believes their customer segment is insulated.
low · management_commentaryNotable Quotes
Our differentiated approach of combining proprietary underwriting models and use of AI and machine learning has so far positioned us as a dominant player to capture this opportunity with responsibility.
We have also increased our provision coverage ratio. So unlike in the market the trend is to lower it in a difficult year. We've not done that.
We intend to keep it above 60% level. Even though there would be a change in mix with mortgage increasing, which should bring down the overall provision level, but we intend to keep it above 60% in the next financial year also.
Frequently Asked Questions
What was Aye Finance's revenue in Q4 FY26?
Aye Finance reported revenue of ₹1,796 Cr in Q4 FY26, representing a +20% change compared to the same quarter last year.
What guidance did Aye Finance management give for FY27?
AUM growth of 25-30% in FY27: Management expects assets under management to grow 25-30% in the current financial year. Credit cost guidance of 3.5-4% for FY27: Credit cost is expected to normalize to 3.5-4% in FY27, supported by better portfolio quality. Operating expense ratio target of 8.25-8.75% in FY27: Operating expense ratio is expected to decline from 9.6% to 8.25-8.75% by leveraging existing capacity. ROA target of 4-4.5% in FY27: Return on assets is expected to be in the range of 4-4.5% for the current financial year.
What are the key risks for Aye Finance in FY27?
Key risks include Interest rate hardening could pressure NIMs — Rising interest rates may increase borrowing costs, partially offsetting benefits from lower-cost debt replacement.; Credit cost normalization may be slower than expected — Despite improving collection efficiency, the NPA bulge from earlier slippages could delay credit cost reduction.; Geopolitical risks from West Asia could impact micro-enterprises — Escalation in West Asia may disrupt local businesses, though management believes their customer segment is insulated..
Did Aye Finance meet its previous quarter's guidance?
Of 2 tracked promises, management 0 met, 0 close, 2 missed.
Where can I read the full Aye Finance Q4 FY26 concall transcript?
The full earnings conference call transcript or source release is available on the linked source material. This page provides an AI-generated summary with filing verification status shown on the financial stats.