Aptus Value Housing Finance Demonstrates Robust Growth and Prudent Management in Q3 FY26

Aptus Value Housing Finance India Limited, a prominent player in the housing finance sector, reported a strong performance for the third quarter of fiscal year 2026, ending December 31, 2025. The company showcased sustained growth across key financial and operational metrics, reinforcing its position in the semi-urban and rural housing finance market. Assets Under Management (AUM) expanded significantly to ₹12,330 crore, marking a 21% year-on-year increase. This growth was complemented by a healthy Net Profit After Tax (PAT) of ₹239 crore for the quarter, reflecting a 26% rise compared to the previous year. The results underscore Aptus's disciplined execution and strategic focus on underserved segments, translating into consistent profitability and operational efficiency. The company's commitment to its core values and strategic initiatives has enabled it to navigate market dynamics effectively, delivering value to both customers and shareholders.

Operational Excellence and Strategic Expansion

Aptus's operational footprint continued to expand, with the company adding 37 new branches during the calendar year, bringing the total network to 335 branches. This expansion strategy is deliberate, focusing on deepening presence in existing states while strategically venturing into new, under-penetrated markets like Maharashtra and Odisha. The company's "contiguous growth" approach ensures a methodical and risk-mitigated expansion, leveraging existing regional knowledge and infrastructure. The customer base grew by 17% year-on-year to 1.79 lakh, demonstrating the effectiveness of its localized approach and product offerings tailored for self-employed individuals in Tier-II, Tier-III, and Tier-IV cities. Disbursements for Q3 FY26 stood at ₹1,030 crore, an 11% increase year-on-year, indicating robust demand and efficient loan origination processes. This consistent growth in disbursements is a testament to the company's ability to identify and serve the unique financial needs of its target demographic, which primarily includes first-time home buyers and small business owners.

The company maintains a strong focus on asset quality, with Gross Non-Performing Assets (GNPA) and Net Non-Performing Assets (NNPA) remaining stable sequentially at 1.56% and 1.18%, respectively. While a slight uptick in 30+ Days Past Due (DPD) to 6.48% was observed, management attributed this to seasonal volatility in collections, particularly around festive periods. This stability in asset quality, despite rapid growth, highlights Aptus's stringent underwriting practices and effective collection mechanisms. The company's Provision Coverage Ratio (PCR) stood at a healthy 25.0%, providing a buffer against potential credit losses and reflecting a conservative approach to risk management. The management's proactive stance on asset quality, coupled with its deep understanding of the local markets, helps mitigate potential risks associated with its target customer segment.

Financial Strength and Profitability

Aptus's financial performance in Q3 FY26 was marked by strong profitability and efficient cost management. The Profit Before Tax (PBT) for the quarter reached ₹304 crore, contributing to a 9M FY26 PBT of ₹884 crore. Net Income Margin (NIM) for 9M FY26 improved to 13.4%, up from 12.9% in the prior year, driven by a favorable spread of 8.9%. This improvement in spread was primarily due to a decline in the cost of funds, which stood at 8.3% for Q3 FY26 and 8.4% for 9M FY26. The company's operating expenses remained well-controlled, with the Opex to Assets ratio largely flat at 2.7% for 9M FY26, demonstrating operational efficiency and a cost-conscious business model. This sustained efficiency is a key driver of its strong bottom-line performance.

The Return on Assets (RoA) for Q3 FY26 was 7.9%, and Return on Equity (RoE) was an impressive 20.2%, reflecting efficient capital utilization and strong earnings generation. For the nine-month period, RoA and RoE were 7.9% and 20.0%, respectively, placing Aptus among the best in the industry. The credit cost for 9M FY26 remained within the guided range at 50 basis points, indicating effective risk pricing and portfolio management. The company's ability to maintain high returns while managing credit risk effectively is a testament to its robust business model and experienced management team.

Aptus's strategy to move towards a higher-ticket segment, evidenced by discontinuing sanctions below ₹7 lakh, has led to some moderation in disbursements this year. However, this move is aimed at building a higher-quality customer base and is expected to contribute to sustainable growth. The company anticipates closing the current fiscal year with 20-21% AUM growth and projects sustainable AUM growth of 22-24% in the future. This growth will be supported by new branch additions, channel augmentation, a higher average ticket size (ATS), and calibrated lending rates on incremental home loans, all without compromising Net Interest Margins (NIMs) or overall productivity. This strategic shift is designed to enhance portfolio quality and ensure long-term value creation.

Financial Summary Table

Note: PAT and PPOP for Q3 FY26 and 9M FY26 are reported excluding additional cost on account of new labour code, past service cost of ₹3.85 Cr (₹2.99 Cr Net of tax).

Technology-Driven Underwriting and Social Impact

Aptus continues to prioritize technology and data science as core enablers for growth and risk discipline. The company's mobile-first fully digital Loan Origination System (LOS) streamlines the entire loan lifecycle, from omni-channel lead sourcing to digital onboarding, credit assessment, technical valuation, legal agreements, and disbursements. A significant 77.9% of leads originate from organic in-house sourcing, complemented by digital marketing and customer referral apps. Over 92% of agreements are executed digitally, and more than 94% of collections are routed through digital channels, showcasing a strong commitment to digitization and efficiency. The integration of real-time APIs, Optical Character Recognition (OCR), and account aggregator data enhances processing efficiency, reduces manual bias, and improves underwriting quality, particularly for higher-ticket, stronger customer cohorts. This technological edge allows Aptus to scale reliably across geographies while maintaining stringent risk controls.

The robust underwriting process is centralized and backed by data science, collecting over 50 key data points for customer profiling and utilizing machine learning for continuous improvement in analyzing profiles and making faster credit decisions. This sophisticated system allows for over 90% of loans to be approved within 72 hours, ensuring both speed and accuracy. The company's stringent credit underwriting includes thorough cash flow assessments, both pre and post-disbursement, and maintaining low Loan-to-Value (LTVs) at approximately 40%. A robust collection management system monitors early default signs within 15-24 months and initiates legal action for 90 DPD cases, ensuring proactive risk mitigation. The fully in-house model, covering business origination, credit, legal, technical, and collections, further contributes to pricing power, reduced turnaround time (TAT), lower takeover rates, and reduced operational risk.

Beyond financial performance, Aptus demonstrates a strong commitment to sustainability and social impact. Its focus on financial inclusion targets underserved borrowers and low/middle-income families in Tier 2, 3, and 4 towns, with 76% of its customers being self-employed and 75% falling into the Low Income Group (LIG). The company's digital initiatives, such as 94.8% digital collections and 91.9% digital agreements, contribute to greener practices. Aptus also invests in building social capital through education upliftment programs, including classroom construction and tribal education facilities, and health initiatives like strengthening healthcare infrastructure and providing mobile healthcare services. This holistic approach underscores its role as a responsible corporate citizen.

Robust Funding and Capital Adequacy

Aptus maintains a diversified and balanced funding mix, with banks contributing 59.1%, NCDs 17.5%, securitization 12.3%, and NHB 11.1%. The average tenure of borrowings stood at 80.0 months for 9M FY26, indicating a stable long-term funding profile. The company has relationships with over 25 lenders and has no exposure to short-term loans or Commercial Papers (CPs). Its credit ratings of AA Stable from ICRA and CARE reflect its strong financial health and prudent risk management.

The company's asset and liability maturity pattern shows a positive surplus across all time buckets, ensuring comfortable liquidity. As of December 31, 2025, Aptus reported a closing liquidity of ₹1,877.5 crore, with a projected surplus of ₹2,143.1 crore available for business up to June 2026. This strong liquidity position, combined with a Capital Adequacy Ratio (CRAR) of 70.5%, significantly above regulatory requirements, provides a solid foundation for future growth and resilience against market fluctuations. The company's equity forms a substantial 36% of its borrowing/equity mix, further strengthening its balance sheet.

Conclusion

Aptus Value Housing Finance India Limited's Q3 FY26 performance reflects a quarter of sustained growth, disciplined execution, and strategic clarity. The company's ability to expand its AUM, maintain asset quality, and deliver strong profitability metrics while simultaneously investing in technology and social initiatives positions it well for long-term success. Management's forward-looking strategy, focusing on higher-ticket segments, geographical expansion, and continued digital transformation, reinforces confidence in its ability to achieve sustainable AUM growth of 22-24%. Aptus continues to demonstrate a balanced approach to growth, risk management, and social responsibility, making it a compelling entity in the affordable housing finance landscape.