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View Promises →Bajaj Housing Finance Limited — Q3 FY25
Bajaj Housing Finance reported a strong Q3 FY25 with AUM growth of 26% YoY to INR 108,314 crore and PAT growth of 25% YoY to INR 548 crore.
bullish
high
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Bajaj Housing Finance reported a strong Q3 FY25 with AUM growth of 26% YoY to INR 108,314 crore and PAT growth of 25% YoY to INR 548 crore. Asset quality remained robust with GNPA at 0.29% and NNPA at 0.13%. Operating efficiency improved significantly as OPEX to NIM fell to 19.8% from 23.2% a year ago. Management introduced medium-term guidance targeting 24-26% AUM growth, 14-15% OPEX to NIM, and ROE of 13-15%. The new near-prime and affordable housing vertical is expected to contribute meaningfully from FY26. Key risks include potential slowdown in real estate sales and competitive intensity compressing spreads.
बजाज हाउसिंग फाइनेंस ने तीसरी तिमाही में शानदार प्रदर्शन किया। उनका कुल कर्ज (AUM) 26% बढ़कर 1,08,314 करोड़ रुपये हो गया। मुनाफा (PAT) 25% बढ़कर 548 करोड़ रुपये रहा। कर्ज वसूली बहुत अच्छी है - बुरे कर्ज (GNPA) सिर्फ 0.29% और शुद्ध बुरे कर्ज (NNPA) 0.13% है। खर्च घटाने में भी सफलता मिली - परिचालन खर्च (OPEX) अब आय (NIM) का सिर्फ 19.8% है, जो पिछले साल 23.2% था। कंपनी ने आने वाले समय में 24-26% कर्ज वृद्धि, 14-15% खर्च अनुपात और 13-15% मुनाफा दर (ROE) का लक्ष्य रखा है। नया किफायती आवास कारोबार अगले साल से अच्छा योगदान देगा। मुख्य जोखिम - रियल एस्टेट बिक्री धीमी होना और बढ़ती प्रतिस्पर्धा से मुनाफा कम होना।
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Real estate cycle downturn
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Read Transcript →Quarter Snapshot
AUM
INR 108,314 crore
+26% YoY
Assets under management grew 26% year-over-year, driven by strong performance across all segments.
OPEX to NIM
19.8%
-340bps YoY
Operating expenses as a percentage of net interest income improved significantly from 23.2% in Q3 FY24.
GNPA
0.29%
+4bps YoY
Gross non-performing assets remained stable at 0.29%, slightly up from 0.25% a year ago.
Disbursement Growth
17%
+17% YoY
Total disbursements grew 17% year-over-year, with retail disbursements growing slightly above the overall rate.
What Changed vs Last Quarter
NEW
Medium-term AUM growth of 24-26%
Management expects AUM to grow at 24-26% annually over the next three years, driven by home loans and the new affordable vertical.
NEW
OPEX to NIM to decline to 14-15%
Operating expenses as a percentage of net interest income are targeted to fall to 14-15% in the medium term, from 19.8% currently.
NEW
ROA of 2-2.2% and ROE of 13-15%
Return on assets is guided at 2-2.2% and return on equity at 13-15% in the medium term, with leverage of 7-8 times.
UPDATED
Credit cost to remain at 20-25 bps
Credit costs are expected to stay in the range of 20-25 basis points, with GNPA between 40-60 bps and provisioning coverage of 40-50%.
DROPPED
Retail disbursements to pick up with affordable/near-prime segment
Management expects retail disbursement growth to accelerate as the affordable and near-prime verticals start delivering, offsetting the current 7% YoY growth in retail disbursements.
DROPPED
Developer finance mix not to exceed 15%
Management stated internal view is to keep construction finance mix below ~15% of AUM, currently at 11.7%.
DROPPED
Leverage ratio target of 8x
Management considers 8x leverage as sustainable and will manage capital deployment to reach that level over time.
NEW RISK
Real estate cycle downturn
A potential slowdown in residential real estate sales could impact developer finance book growth and asset quality.
NEW RISK
Competitive intensity compressing spreads
Intense competition in mortgage lending may compress net interest margins and spreads, affecting profitability.
NEW RISK
Execution risk in affordable housing vertical
The new near-prime and affordable housing segment carries higher origination costs and credit risk, which may not materialize as expected.
NEW RISK
Regulatory changes in housing finance
Changes in regulatory requirements, such as the 50% individual home loan norm, could constrain business mix or increase compliance costs.
RISK GONE
Intense competition in prime home loans
Competition remains very intense in the prime home loan segment, which could pressure growth and spreads.
RISK GONE
Potential asset quality cycle in developer finance
Analyst raised concern about historical patchy asset quality in developer finance during downturns; management defended granular underwriting but acknowledged risk.
RISK GONE
Slowdown in retail disbursement growth
Retail disbursements grew only 7% YoY in Q2, raising concerns about future AUM growth trajectory as base expands.
RISK GONE
Regulatory silent period limits guidance
Management refrained from providing specific forward-looking guidance due to IPO-related silent period, creating uncertainty for investors.
Fast read
Guidance and risk preview
Management expects AUM to grow at 24-26% annually over the next three years, driven by home loans and the new affordable vertical.
A potential slowdown in residential real estate sales could impact developer finance book growth and asset quality.
View Risks →