Aavas Financiers Q2 results: Net profit rises 11% to ₹182 crore, NII grows 10%

Jaipur based affordable housing finance company Aavas Financiers reported a 10.75% year-on-year increase in net profit to ₹182 crore for the second quarter of FY27, compared with ₹164 crore in the year-ago period.

Net interest income (NII) rose 10.1% year-on-year to ₹431 crore from ₹391 crore.

The affordable housing finance company reported a gross non-performing asset (NPA) ratio of 1.11% and a net NPA ratio of 0.70%.

H1 FY27 performance

For the first half of FY27, Aavas Financiers reported assets under management (AUM) of ₹24,800 crore, up 16.1% year-on-year. Net profit grew 16.4% to ₹350 crore, as per exchange filing.

The company reported a net interest margin (NIM) of 7.76% and a cost-to-income ratio of 42.9% for the first half.

Net worth grew 15.4% year-on-year. Return on assets improved by 4 basis points year-on-year, while return on equity rose by 5 basis points.

Disbursements and business expansion

The company said that it disbursed ₹3,510 crore during H1 FY27, registering 30% year-on-year growth. Disbursements in Q2 were close to ₹1,900 crore, up 21% from the year-ago quarter.

Aavas Financiers had 443 branches across 15 states at the end of the quarter. It added more than 21,500 customers during the first half of FY27.

Chief Executive Officer Manu Singh said the company's AUM is expected to cross ₹25,000 crore in October, with nearly 4.5 lakh customers served. The company has outlined a long-term ambition of reaching ₹50,000 crore in AUM and expects to deliver more than 20% growth over the long term.

He added, "During the quarter, we expanded our branch network to 443 across 15 states. We will continue to invest in branch expansion to further strengthen and diversify our presence."

Margins and asset quality

The company's cost of borrowing stood at 7.64%, while its spread remained above 5%. NIM increased by 11 basis points quarter-on-quarter to 7.81% during Q2 FY27, supported by stable borrowing costs and risk-adjusted pricing, Singh said.

The 1+ days past due (DPD) ratio improved by 18 basis points year-on-year to 3.81% in Q2 FY27. The company said its asset-quality indicators remained within its guided range.

Singh said the company would continue to focus on sustainable profitability, prudent lending, governance and disciplined liability management as it pursues growth.

Aavas Financiers shares closed 0.21% higher at ₹1,116.40 on the NSE on October 26, up ₹2.30, ahead of earning announcement.

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