Note: This is a preliminary transcript and may contain inaccuracies. It will be updated with a final, fully-reviewed version soon.
Aadhar Housing Finance Ltd (NSE: AADHARHFC) Q4 2026 Earnings Call dated May. 05, 2026
Corporate Participants:
Rishi Anand — Managing Director and Chief Executive Officer
Rajesh Viswanathan — Chief Financial Officer
Analysts:
Kunal Shah — Analyst
Rajat Kumar — Analyst
Unidentified Participant
Arun — Analyst
Presentation:
Kunal Shah — Analyst
Ladies and gentlemen, very sorry for the delay which has happened by. Good day and welcome to other Housing Finance Q4FY26 earnings conference call hosted by JM Financial Institutional securities Limited. As a reminder, all participant lines will be in the listen only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing start and zero on your touchstone phone. I now hand the conference over to Mr.
Rajat Kumar from JM Financial Institutional securities Limited. Thank you. And over to you.
Rajat Kumar — Analyst
Thank you. Rituja. Good evening everyone. Apologies for the slight delay. Welcome to 4th of July 26th earnings call of Aadhaar Housing Limited. On behalf of JM Financial, I would like to thank Aadhaar Management for giving us the opportunity to host this call. Today we have with us the entire top management team of Aadhaar represented by Mr. DeshankaTripathi, Executive Vice Chairman Mr. Rishi Anand MD and CEO Mr. Rajesh Vishwanathan, CFO and Mr. Sanjay Mujchandani, Head Financial Planning. I now hand over the call to Rishi sir for his opening remark and then we can open the floor for Q and A.
Over to you sir.
Rishi Anand — Managing Director and Chief Executive Officer
Thank you so much Ajit and a very good evening to all of you. First of all, apologies for this slight delay. Technology sometimes plays its own role, but there we are. Thank you for joining us today to discuss Aadhaar Housing finance performance for the fourth quarter and full year ending March 31, 2026. We are pleased to close the financial year on a very strong note with consistent execution across growth, asset quality and profitability matrices. I am happy to share that during the year we have achieved a critical milestone with our asset under management crossing 30,000 crores.
This reflects the strength of our business model and our continued focus on affordable housing segment. In addition, we have delivered our highest ever disbursement of Rupees 3087 crores in a single quarter in Q4FY26. Driven by steady demand and improved execution across our branch network. The operating environment during the quarter remained very very supportive for the housing finance sector as a whole. We saw healthy demand momentum across markets. Importantly, demand in our segment continues to remain largely end user driven with significant share coming from first time home buyers, particularly across emerging markets.
This provides stability to growth and limits speculative activity in the segment. At the same time, competitive intensity remains elevated in certain segments, particularly in the urban segment where banks continue to be active. However, in the low income segment where we operate demand trends remain very steady with well supported structural drivers. Overall, the combination of supportive policy measures, stable demand and healthy asset quality trends provide a constructive backdrop for affordable housing finance segment now coming to Aadhaar’s performance for the quarter and full year.
As of 31st March 2026 our AUM stood at 30,571 crores crossing the 30,000 crore milestone which I just mentioned registering a 20% y o wide growth. Disbursements for FY26 stood at 9,556 crores, a 17% yoy increase reflecting steady lending momentum across our core markets and a PAT of 1096 crore at 20% YoY growth on all the three critical parameters. We have stood by our guidance and commitment to the market as we go ahead. We would continue with similar guidance of 20% AUM, 20% profit and 17 to 18% disbursement growth.
Disbursements during the quarter four was highest in the company’s history with 3,087 crores which was 20% YoY increase supported by strong on the ground execution and consistent sourcing through branch network. Our portfolio continues to remain fully secured and retail in nature with a balance between home loans which is 73% and non housing loan which is loan against property at 27%. We continue to maintain a well diversified book with an average ticket size of 10.9 lakhs and a 60% loan to value ratio which is well within comfort levels.
The salaried segment continues to be at 55% share of the AUM balance transfer outflow during the financial year FY26 improved by 60 as compared to FY25 supported by focused rate retention efforts and data driven customer engagement. Asset quality remains pristine with gross NPA standing at 1.08% a sequential improvement of 30bps versus quarter 3 FY26 collection efficiency continues to remain strong above 99.8% reflecting consistent on the ground execution. Importantly, early bucket delinquency remains stable and stage two assets continue to show improvement by 30bps compared to last quarter.
One plus GPD also reflects improvement of 78bps on a sequential basis. Our underwriting discipline combined with strong field level collections and analytic LED monitoring continues to support overall portfolio quality. We continue to expand our distribution footprint in a calibrated manner. We have added five new branches in quarter four and 46 branches in the full year in line with our strategy taking our total network today to 6 as of March 31st to 626 branches across 22 states covering over 550 plus districts.
We are beginning to see encouraging traction in our urban markets along with continued support sorry continued strong performance in the emerging markets. This gives us confidence in our approach of building a balanced presence across geographies. Our deep local presence and branch led sourcing model continue to be key strengths enabling us to understand customer profiles better and drive consistent growth. Our geographical diversifications remain strong with no single state contributing disproportionately to the AUM.
We continue to maintain less than 15% exposure in any state on all three critical parameters I.e. AUM disbursement and distribution. Our approach of combining branch expansion with productivity improvement of existing branches continues to support sustainable growth. Technology continues to be a key enabler in our growth during the year. We are increasingly leveraging AI and analytics across sourcing underwriting collections which is helping us improve turnaround time, strengthening risk assessment and enhanced collection efficiencies.
We have also started incorporating AI LED tools in select part of our loan life cycle and while this is still evolving, we are seeing early benefits in terms of productivity and decision making. Looking ahead, we remain confident about the operating environment. The affordable housing segment continues to benefit from structural drivers including favorable demographics, increasing formalization and continued policy support such as pmay. We believe demand in our segment will continue to remain stable and end user driven supported by first time home buyers and increased penetration in underserved markets.
While we remain mindful of competitive intensity in certain segments and in the evolving markets, our current portfolio trends and operating matrices give us confidence in our growth trajectory. With a strong balance sheet, stable asset quality, diversified distribution network and continued focus on execution, we remain well positioned to sustain our performance and deliver on our medium term guidance. Aadhaar remains committed to its mission of enabling home ownership for low income families while delivering consistent and sustainable returns to all the stakeholders.
With that I would now hand over to Rajesh our CFO to take you through the financial performance in detail. Rajesh, over to you. Thanks Sushi. Good evening everyone. I would like to take you all through the financial performance for quarter four FY26 and full year FY26. In quarter four FY26 our AUM has grown by 20% on a buy on basis. Our overall borrowings on 31st March 2026 stood at 18,744 crores compared to 16,322 crores as at the previous year end which is a growth of 15%. The borrowing mix at the end of 31st March 26th is 51% from banks NHP share is 22%, NCD share is 19%, ECB share is 5% and others is 4%.
Our incremental borrowing for quarter four FY26 stood at 2430 crores coming in at 7.6% and for the full year it was 6396 crores which came in at 7.8%. Currently we have 42 strong and diversified borrowing relationships. In quarter four fresh NHP borrowings were 705 crores which came in at 6.9%. Of this the affordable housing finance fund was 141 crores which came in at a rate of 4.3% full year FY26 NHP borrowings were 1,304 crores which came in at 7.2% of which the affordable housing finance fund was 261 crores which came in at 4.7%.
As a strategy to diversify the funding mix during quarter four FY26 we have availed term loan of 500 crores which came in around 7.5% from domestic DFI NABFIT which is national bank of Financing Infrastructure and Development. The exit cost of funds on 31st March 2026 stood at 7.71%. In terms of fixed and floating nature of our book, 76% of our borrowings and 73% of our assets are on floating basis. Undrawn sanctions as at 31st March 26th is 1687 crores of which we have 246 crores undrawn from NHP liquidity at the end of quarter 4 FY26 stood at 1425 crores.
The exit spread at the end of 31st March 26th was 5.82% as compared to 5.7% at the previous year end. Our cost to income ratio for FY26 came in at 35.9% as compared to 36.4% in FY25 and improvement of approximately 55bps. This is in line with our guidance of dropping cost to income ratio by about 50bps in the current financial year. GNPA has seen a marked improvement which is also a seasonality impact in quarter 4 GNPA came in at 1.08% as compared to 1.05% in quarter 4. FPI Capital Adequacy Ratio for quarter 4 FY26 stood at 42% for tier 1 and 0.5% for tier 2.
Finally, the PAT came in at 1108 crores without the impact of the new Labor Law code. This is compared to 912 crores in FY25 rendering a Y on Y growth of 22%. Quarter 4 PAT came in at 311 crores as compared to 245 crores in Quarter 4 FY25, a growth of 27%. FY26 ROA and ROE again without the impact of the new labor law code is 4.4% and ROE is 15.9%. For quarter four, the ROA and ROE is 4.8 and 17.1. This is compared to 4.4 and 15.9 in quarter four FY25. Now the impact of the Labor Law code which we have already taken in quarter 3 FY26 is 16 crores which as per the ICI guidelines is shown as an exceptional item.
Also included in the manpower cost for quarter four FY26 is an amount of 13.5 crores both in quarter four, FY26 and full year FY26 which is the impact of fresh ESOPs that we have granted to employees in the quarter four of the current financial year. The impact of this is in the quarter and full year is 13.5. Number of employees as at 31st March 26. On road was 5400 and off role was 3900 as compared to 4600 on roll last year and off road was 4300 in March 25. We are focusing on maintaining a healthy book and delivering consistent performance on a quarter and yearly basis.
With that we can open up for questions.
Kunal Shah — Analyst
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on the Touchstone telephone. If you wish to remove yourself from the question queue, you may press star and 2. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue symbols. The first question is from the line of Ranish from icici. Please go ahead.
Questions and Answers:
Rishi Anand
Yeah. Hi sir. Congrats on a good set of numbers. Just two things are one on this impact of East Asia war. So I mean do you foresee or do you see any impact on ground, let us say in month of March, April and if. Yes, I mean are we intending
Unidentified Participant
To calibrate displacement in near term just as a, you know, sort of measure?
Rishi Anand
Hi Ranesh. Thank you for your question. Okay, West Asia, what are the current geopolitical issues? You know, the first line of defense. And I always make this statement for us the first line of defense is always, you know, if there was something to be going wrong, it would be the bounce rate, you know, increase or decrease in the bounce rate. Fortunately the last, the current, current month, three cycles of bounce rates have not seen any trend whatsoever. You know, our bounce rates have been stable for the last six quarters.
So from that perspective we are, we are I would say safe as we speak. That is one second is from a ground up perspective. You know, all over 2,000 people in the collections have been given heads up to be very careful and closely in connect with the customers. That is point number two. Point number three is most of our customers actually deal in essential commodities. And if I can go back and relate to various situations that we have all seen, for example the COVID situation etc. You know, the essential commodities was, people dealing in essential commodities got hardly impacted because that’s what, you know, that the cycle of essential commodities continues.
That is number three. And lastly, you know, our belief and the way we look at the West Asia crisis is, you know, the first people who will get impacted are companies which would be highly exposed to NRI communities. Fortunately in our case we hardly have any exposure to NRI consumers. I hope that helps.
Rajesh Viswanathan
Yeah, most of these indicators are actually showing us no sign of stress. It is as of now.
Rishi Anand
That’s right.
Rajesh Viswanathan
Okay.
Rishi Anand
And so my second question is on this, you know, growth. Right. So I’m not too much keen on asking you about just from a three to five perspective. I mean can you share just your thoughts on the broader industry wise data points, you know, in a sense less than 25 lakh 50 pixels. The total disaster market and our market share and how that market share has been trending over the last two to three years. So just to get some idea about how we are positioned and you know, whether
Unidentified Participant
At this 20% plus growth, you know, sustainable or not.
Rishi Anand
Right, right, right. Okay. So Ranesh, a few data points total outstanding of the entire housing portfolio across various financial institutions will be close to about 37 trillion. You know, if I, if I break that structure down into low income housing, that’s where we belong. So low income housing basically would be average ticket size of the book at the book level below 15 lakhs. That’s where we belong. You know. And if I were to further which which approximately housing finance companies in the portal pool is, holds about 20% market share.
And if I come to low income housing finance companies and look at our share in that peer group, we have been trending around 16, 17%. If I look at the current numbers we are at about 18% market share and these are ballpark numbers. How do we look at our numbers and how do we look at our growth strategy as we go ahead? We’ve been delivering constantly, we’ve been delivering an AU growth of upward of close to about 20, 22%. And I have just in my opening statement clearly mentioned that we will look at similar numbers from a short term to med term perspective.
And as an organization, on a lighter note, we work on something called milestones. You know when we opened this year and I remember interacting with you as well that you know we had a milestone number of 30,000 crores. We fortunately crossed that number with all the efforts of the entire Aadhaar team. You know, if I look at the trajectory of numbers that I’ve guided 20% growth. If I look at three years from now, you know the next milestone obviously in three years should be 50,000 crores. That is one perspective.
Number two, the third point is, you know there is, there is and I’ve been making the statement and the more I travel and go out to state levels etc, I get more pulse about it. That is there is little too much that is happening at the ground level right now, right from state level, state level government authorities to central level. And recently I was in the state of Odisha last week itself and I happened to catch up with or I was fortunate to meet up with the additional Chief Secretary Housing Development Finance Secretary, Odisha and you could really see how the BLC projects under PMI and AHP projects which is affordable housing projects are shaping up.
25 plus 1000 units up for grab. And similar is the situation across multiple states. You talk about Tamil Nadu, you talk about Karnataka, you talk about mp, you talk about Gujarat. Every state government is sitting on almost ready constructed houses, BSP advances being given already. So there is too much that is happening at the ground level And I don’t foresee any reason why demand should be under question. It can be unless you know, unforeseen situations like Covid etc happen which obviously Touchwood we are not, you know, looking at those situations.
But steady state, you know, 50,000 crores three years from now. Got it, got. It’s very, very helpful sir. Thank you for such a detailed insights. Thank you. And that’s it. Thank you so much. Finish.
Kunal Shah
Thank you. The next question is from the line of Kunal Shah from Citigroup. Please go ahead.
Unidentified Participant
Yeah, thanks for taking the question. So three questions. Firstly, with respect to the Led growth both in terms of disbursements. I think maybe it is lagging a bit on the home loan side. Would it be more kind of a seasonal phenomena? Any particular reason like last 2, 3/4. In fact the overall non retail home loan part, maybe non home loan part that is growing relatively slower. So if you can address that and how should we look at it in terms of the overall AUM growth? Second is on the fee income side or maybe on the non interest income side.
Both the assignment income is quite high. So was it like equally larger proportion of assignments done during the quarter or it was more in terms of the spreads which have led to this assignment and even other income seems to be slightly higher. Is there any one off out there? Yeah, so that’s the second question. And thirdly on ESOP cost. So this is just a Q4 cost which is there. This is not going to accrue even in FY27. This is like a one time cost which we had taken and it is over. There will be no impact getting into FY27 too.
Rishi Anand
Okay, so I’ll take the first question first. Lab growth, you know, and you’re right when you read at the data that you know lab growth has been slightly slow. I would say this was deliberate and it was, it was kind of completely planned and this plan or deliberation started when the tariff issue happened. You know and we caution our teams to, you know, be very careful and go. I will not say go slow, it might be the wrong choice of words but be very careful. You know, we don’t want to do something in haste which will go out and look at our delinquency numbers.
So we kind of cautioned them right now. Also I would say given the current situation of West Asia and I spoke about it a while back, I don’t want to again haste things. We are today at the book level, at the AUM level we are 73, 27. We have a lever of about 3% and we would want to play at the right time. You know, we are still incrementally doing about increasingly doing about 23, 24% loan against property and we want to maybe take IT to about 25% in the current quarter. And we will wait out as I said.
So that is, I won’t say there is anything which is growth or de growth in lone against property. It was purely our management call to wait and watch and we still kept doing 23, 24%. But do we have a room of increasing it? Yes, we have a room of increasing It. But we’ll wait for the right time on your next question. Rajesh will come in.
Unidentified Participant
Differences in the dealing bouncer trend between lap and pure home loan?
Rishi Anand
Fortunately no. But when it comes to stage three we all know that there is a differential of about 0.75%. The loan property is always 0.75 to 1% in our current book it will be 0.7% higher in PA but risk adjusted spread will be about 3.3 and a half percent. So obviously that sets off completely.
Unidentified Participant
Got it. Yeah.
Rishi Anand
In case of DA income, you’re right. The total DA that we did for the whole year was in the range of what, 1725 crores. Both the years was a similar figure. And the upfront income which seems higher is on account of better spreads that we have got because of the spreads are better in the range of about 80 to 85 bips. So that’s a benefit that we got quarter four. DA looks slightly higher because some of the deals which ideally you would have liked to consume in quarter three got pushed to quarter four.
So to that extent it looks slightly higher. But otherwise if you look at it, this would be broadly divided by four in our case. And the way we look at DA income is that the net impact of DA in FY25, when I say net impact of DA it is the upfront income that we book on fresh assignment and the unwinding of the excess of the existing book. If you look at it for FY25 and FY20 as well, FY25 and FY26 is exactly the same figure. So the overall impact on PL is actually positive to that extent in the current financial year.
So and the other. And the way we look at DA is probably you will see in overall DA compared to the 1725 crores that we did the current year. Probably next year we would be trying to grow that in the range of anywhere between 10 to 15%. In terms of overall DA. In terms of other income, you are right. There was. There was some two one timers to the extent of about 6 to 7 crores. One was an IT refund of about 2 and a half crores that we have taken back to the P and L. And the second was some old write backs that we had which we had not done for a long time and that that is about to the extent of about three and a half crores.
So put together in the range of about six to seven crores that we had as a one time which is sitting in the fee income.
Unidentified Participant
Sorry, it Refund was.
Rishi Anand
It was a two and a half crores.
Unidentified Participant
Okay. And total was seven odd crores. Yeah, that’s
Rishi Anand
Right. That’s, that’s
Unidentified Participant
Okay. Thanks. Yeah, that’s helpful. Yeah. Thank you. Thank you. Yeah, thank you.
Kunal Shah
Thank you. The next question is from the line of Shreya Shivani from Nomura. Please go ahead.
Operator
Yeah. Thank you for the opportunity and congratulations on a good set of numbers. I have one question for you on the yields. So can you help me understand you’ve taken a PLR reduction from February 26th. The interest rate environment seems very, I mean it’s very volatile depending versus what you would have, how you would have thought in February 2026. So how are we thinking about the yields for the year of FY27? Also as you spoke about the lab book, can you just clarify how much does that, if you increase your lab mix, for example, how much of that, how much boost does that give to our yield?
So just the commentary on yield. This is the interest rate environment we are in right now. And what would we do with that PNR cut we have taken in February 26?
Rishi Anand
Shivani Rajesh here. I will chip in and probably Rishi will top it up. The February rate pass on that we did 15bps was the impact that we had received over the financial year that we passed on as per our RPLR formula that we had and as is guided by the Alco and our board, we had to pass it on and there was no questions on that pass on. Yes, things have changed significantly when we look at February and when we look at now, our view is that the interest rate cycle has stagnated and to a certain extent will be stagnant for at least 2, 3/4.
And we post that if inflation doesn’t come under control then there may be some interest rate surprises on the other side. But as we look at it, at least for the next two, three quarters, I think to a certain extent there will be status quo. Now coming to the other important thing, the way we like to look at it instead of yields is basically spreads. As we look at it, our exit cough was about 7.7% and our exit spreads were 5.82%. We have always guided that our spreads year on year will probably see some contraction to the extent of about 8 to 10 bips.
This is predominantly because our incremental business that we do in terms of yields is lower than the book yield that we are carrying. Our book yield is, if I’m not mistaken, about 13.52%. And if you look at our incremental yield, the incremental yield will be in the range of about 13
Rajesh Viswanathan
13%.
Rishi Anand
So yes, the other question which you asked was will there be a kicker that you will receive by doing more of labs? For example the benefit that we get by doing more NHL versus HL is almost to the extent of 400 bps. So if my incremental disbursements was theoretically 25% lap and if I swing 5% towards NHL I would obviously get a benefit of 400 on that particular portfolio that I disperse. And to that extent of that we think that we have one lever that is available for us to ensure that the spread doesn’t contract enough.
Very fast manner I can add to that. Shreya,
Rajat Kumar
You
Rishi Anand
Know Rajesh spoke about spreads and you know another data point at the company level is 74% of our asset side is floating in nature and similar 73% of our liabilities floating in nature. So while you know we are talking about the current scenario etc. And if at all there is, there is a, you know, substantial increase in our cough, you know we being a majority floating book is going to be passed on to the consumer of course subject to alcohol and board approvals etc. So at any stage we will try and we will definitely protect our spreads.
Operator
Right. Just one clarification. I wanted the part you mentioned about 8 to 10 bits year on year reduction in spread is the mix between last and home loan stays where it is. If you do anything about the LAP that does that reduction still play out for you?
Rishi Anand
So when we talk about 8 to 10 base reduction we are, we’ve been the data that we work on is about 25, 26% lap. But yes you are right we have, we still have room of about 3, 4% of enhancing lab and that can be a play area. But I also if you remember my opening statement I said in fact to the first question and dhinish I said that you know lap we are wanting to look at it very carefully. We are not in a hurry. So I’m sure in the current quarter I’m not going to be taking substantial jump on lab. We will wait out but yes, we have a room.
So if push comes to shove that’s the play area.
Operator
Right. Right. This is very useful. Thank you and all the best.
Rishi Anand
Thank you.
Kunal Shah
Thank you. The next question is from the line of Arun Anthony from JM Financial. Please go ahead.
Arun
Hi. Hi. Thank you for the opportunity. First of all congratulations on a good set of numbers and crossing the milestone of 30,000 crores. Just a couple of questions from my side. First of all I just wanted to know what has led to the increase in one plus TPD by approximately 80 dips. And then another question would be on the disbursement growth. So disbursement growth has been quite robust in this quarter. Approximately 30% QoQ. So is there any specific states or state which has led to this strong momentum?
And then one last question is that the incremental cost of borrowings have also gone up by approximately 10bps. Is there any reason which why it has gone up during this quarter? That’s all from my side.
Rishi Anand
Great, thank you Arun. One correction, oblique clarification. You mentioned one plus increasing by 80bps. Actually it is reduced by 80bps. So I just wanted to clarify that. I, you know I will not, I can’t be singling out any one effort on, on single on a reduction of 80bps of one plus. I think it is a continuous effort. You know all our port soldiers in collection side, about 1800 of them, you know, on a daily basis. Track that as an organization. I would say about 18 months back is when we started driving down OnePlus as a deliverable number.
From purely focusing on NPA to also coming back to OnePlus because OnePlus gives you that bulge of 6,190 and we wanted to avoid that at any given point in time. So I think it is a combination of concentrated efforts, multiple efforts right from our basics of fall center calling to the customer banking cycles field efforts. It’s a combination of multiple things which has reduced the one plus by 80 pips. Your second part of the question was 30% overall growth for the quarter on a sequential basis.
Has any particular state given me a huge jump on disbursement? I would say I don’t want to single out any state but I will still give you some names which have, which are standing out. Maharashtra standing out for us. Madhya Pradesh standing order for us. Tamil Nadu did surprisingly well. Delhi, Karnataka, Uttarakhand. So these are, you know, few top line numbers I thought I’ll mention. But you know these states have given the required numbers. The third part was on cough Rajesh. In terms of cough, the COF for quarter three as you rightly said was 7.45 and quarter four was 7.54.
This is predominantly because we had kept bank borrowings to the extent possible. We had deferred the drawdowns of that. Some of the drawdowns or incremental, highly higher drawdowns happened in quarter four vis a vis Q3. And that is precisely the reason the 10bps is playing out. Anyhow, we are seeing that our exit off which is 7.7% and we believe that for a significant point of time there is not going to be a significant downward movement on this. Considering the interest rate scenario that we just talked about.
If you are able to maintain 7.7% cough throughout the entire next year, I’ll be very, very happy to be very honest. As we said, we will have to wait and watch for the interest rate movements. Rishi says any of we are floating book. If we see any incremental interest rate movements which is very significant, we have an ability to pass it on to our borrowers based on our internal alco and board approvals. And we will then wait and watch and do it. But we personally believe that there is going to be a stagnancy in interest rates at least for the next two to three quarters.
Arun
All right, that was all from my side. Thank you.
Kunal Shah
Thank you. The next question is from the line of Prithviraj Patil from Investec. Please go ahead.
Rishi Anand
Yeah, hi. Thanks for the opportunity. So I just. I was looking at the OPEX to AUM and it is increased sequentially. So I just wanted to know like the branch count has grown by only around four branches. So what has led to this growth? Have we added on new employees here? I think OPEX to aum it is always a quarter four phenomenon. Because we run various competition and contests in quarter four for our employees. And if you look at. I’m just flipping it to cost to AM or even the cost to income ratio.
If you look to the cost to income ratio. If you look at quarter four last year and quarter four of current year there has been an improvement in cost to income ratio from quarter four to quarter four. But sequentially between quarter three and quarter four there will always be a growth because there are some one timers which typically get booked into quarter four which are predominantly related to contest and competitions that we roll out for our sales employees in the field.
Operator
The bioi reduction 50 days. Yeah.
Rishi Anand
On a BIOI basis. If you look at cost to income ratio, there has been a reduction in cost to income ratio from about 37.9 to 37.1. And even if you take the full year it has reduced from 36.4 to about 35.9. Sure. Thank you. And what is the employee count as of March 26th? The onroll count is 5430. Offeral round is 3965. Sure. Thank you. Thank you.
Kunal Shah
Thank you. The next question is from the line of Shreya Chatterjee from Ageless Capital Finance. Please go ahead.
Operator
Hi. Thank you for taking my question and congratulations on a good set of numbers. So my first question is a bit if you could give a bit more granularity of the 20% AIM growth that you are guiding for on the basis of these states which you see the higher number of growth which you think will grow faster and also on the ticket size meaning if your average ticket size is 1.1 per million it’s 11 lakhs around. But in the EWS and lid space like are you seeing a higher amount of growth in the 2 to 5 lakhs space or higher than 5 lakhs?
If you could give some color to that.
Rishi Anand
Hi Shreya, one is you wanted the first part of Your question was 20% AUM growth, which are the states that are going to contribute to broadly? You know all of the states are going to be contributing substantially where we are present. But as in the previous question I had highlighted, you know if I can call out few states, Uttar Pradesh will be contributing the largest chunk for us followed by and it is not in any order so I’m just naming few states. Maharashtra, Madhya Pradesh, Tamil Nadu, Delhi, ncr, Karnataka, Haryana, Uttarakhand, Rajasthan.
These are the top eight or ten states which contribute the largest chunk for our business followed by the other states. And on a lighter note, we see some potential now in West Bengal too as we as we look at the political change that is one second is you spoke about 10.8 11 lakhs of our ticket size EWS Lib below 5 lakhs, hardly any traction. And even if I talk about our AUM numbers below 5 lakhs will be close to about 3%. Not much. The real traction is actually between 5 lakhs to I would say 25 lakhs.
And that’s where we are able to with our concentrated efforts across urban and emerging, we are able to maintain that 11 lakh kind of average ticket. So incrementally our average ticket size will be about 12 and a half lakhs.
Operator
Got it. And so my second question is on the this OPEX to AUM ratio or the cost to income ratio. So where do you see it going forward and like what will contribute to it? Like what is your branch productivity right now and how many branches are above that average branch productivity and how many branches ability to just elaborate about a bit more to that.
Rishi Anand
So the way we look at cost to income is. And if you look at it consistently over the last two financial years, we are dropped almost to the extent of about 150, 160bps. We’re looking at another 50bps probably in the, in the next financial year. What will be driving this? It’s a combination of productivity. Some of the, some of the projects that we have taken up on sales productivity which will come from our AI driven models that we will be able to deliver on productivity. In terms of how productive are our branches Typically the branch that we set up in a 9 to 12 month period, if it’s a small branch, they become profitable or productive, if I can use the word.
And the slightly bigger urban branches, they take anywhere between 12 to 15 months to become productive. So going by that scenario, I think majority of the branches that we have set up to quarter one of last financial year have in that sense become productive I would say. And the way we look at contribution of the branches is how fast they can achieve this. 9 months and 12 months for a smaller branch and for a bigger branch, 12 to 15 months. And I dare say that majority of the branches do turn productive within this period of time.
Rajat Kumar
If I can come in there
Rishi Anand
Quickly, say us. I think Rajesh explained it very nicely, but just as a point. When we talk about branches at Aadhaar, we follow a very differentiated structure. As against anybody else in the market, we follow something called the four categories of branches. Starting from a very small 5060 square foot office called Ultramicro, moving to a micro branch, small branch and then main branch. So that’s the category Rajesh spoke about. 9 months to 18 months. Every branch will have a different trajectory of becoming breakeven or profitable.
Operator
Thank you, that was really helpful. Just my last part of the question is on the cost of funds, do you see any meaningful improvement in FY27 or will it continue?
Rishi Anand
As I said, considering the overall macro, I would be very happy if I’m able to maintain the exit rates of the current year. To be very honest, we don’t think that anyone is expecting a drop in the cost of funds from here or a drop in interest rates from here. And the pass ons for us also has come through majorly. So I think there will be a great extent next 2, 3/4 at least we see a status quo right through our cost of funds. And if we are able to pull the lever on the lab business that we do and some of the emerging market business that we do, we believe that we will be able to take the yields A bit higher and technically our spreads.
Spreads will get protected. That is basically the strategy we are trying to play out.
Kunal Shah
Thank you. Thank you. The next question is from the line of Nishita from Kotak. Please go ahead.
Rishi Anand
Hi, thanks for taking my question. If you could give some color in terms of how your incremental ticket sizes have moved, you know, in the last four quarters. I mean you mentioned a number of 12 and a half lakhs in this quarter, but how would this be like a year back? Just a minute distance. They just pulling it out. Just a minute. Yeah, yeah, sure. Okay. So the movement has been in the range of so 10 and a half rack as I told you is 10.8 is on the book. I will do a club of home loan and non home loan.
So 13.6 was in quarter three. FY26, 12.6 is the last quarter. Slight drop prior to that was 13.8, 14.
Rajat Kumar
Got it. So we actually come back. It’s
Rishi Anand
Been in the range of I would say 12.5 to 13.5. Mission and Nishit. The point to note over here is our lap contribution has dropped slightly in quarter four. We have done only about 24, 25% of our disbursements in LAP. Typically we do about 28, 29%. If you did more lap, probably that ticket size would have come in slightly more lower.
Unidentified Participant
Got it, got it. So you’re actually going down the ticket size. You’re not going up the ticket size, right? I mean it’s not. No,
Rishi Anand
I will, I will not say we’re going down the ticket size. And you know, that is where our emerging and urban strategy plays out. You know, when we focus more on emerging locations and I have called it out in the previous call as well, emerging ticket sizes will be much lower. You know, today my emergency take a ticket size will be in the range of about 8.5, 8.6 lakh. Emerging B will be again 10 lakh. Emerging A will be 12 lakh. So that’s what plays out. So if, if the, if the team start will end and urban will be typically 17, 18 lakhs depending on which city we are talking about.
But if the strategy that we want to drive of urban emerging is right, the ticket size should be under control. You know, the intent is to maintain the book level ticket size even when in the shorter term in the range of 10 to 11, 11 and a half lakhs. So that’s the aim. Some quarters it will go up, some quarters it will come down. If emerging performs in one quarter Emerging performs over the targets, your ticket size suddenly will jump up a little bit. So that’s how it works.
Rajat Kumar
So basically you are emerging essentially. You mean deep impact branches, right?
Rishi Anand
Sorry, yes, basically deep impact, yeah. Smaller, deeper impact branches. Right? Yeah, yeah.
Rajat Kumar
So you are comfortable to go down the ticket sizes is what we are saying. But probably, you know, the deep impact strategy doesn’t change. But maybe in terms of focusing on lap, that’s something which we probably, you know, kind of be a little bit more careful at this. Is that a fair way to read it?
Rishi Anand
No, I will not say we are comfortable, but ticket size going down, we are very, very comfortable by sustaining the ticket size. And we know with you know, cost of cost of construction, etcetera Going up, there will be a slight increase in the ticket size which we are fine with. You know, to a today at a book level 10.8, moving to 11.5 eventually, you know, doesn’t bother me too much.
Rajat Kumar
So. And you know, your disposal. So the reason I’m asking all of this is your disbursement growth in the retail side or essentially the. In the core portfolio, it’s almost 26%. On the home loans, it’s almost 26% this quarter which is obviously a phenomenally good number. So who is curious as to
Unidentified Participant
What is it that has driven this and how should one think about it? I mean it’s something which I guess is way ahead of probably your peers.
Rishi Anand
I would say two things, Nishant. One is just as a slight correction, we just do retail. So not on retail side, we just do retail. We don’t do anything. Sorry,
Rajesh Viswanathan
I was meaning home loans. Sorry.
Rishi Anand
Yeah, yeah. So in home loans, yes, this quarter has been. There has been a 26% growth on home loans. I think it is also to credit should also go to the various government initiatives like PMUI. You know, we are the largest player in PMI play today. Close to about 50 crores of our subsidies have gone to the consumers, about 15,000, 16,000 customers. So that obviously, obviously has started playing out. And I will come back to my emerging. But again a lot of trust and focus on the senior management on emerging is giving a little push on more home loans.
And that is also evident. That is point number two. Point number three is I called out saying that for the last three quarters since the tariff issue happened post that we’ve been really careful on non home loans. The non home loans, you see a slight dip in the way the quarter on quarter non home loans has moved. But the teams still have to do business they still want to meet their budgets and incentive structures. So, so home loan started coming in which is good news. Higher the home loan the better it is.
And with a clarification that we will want to maintain at about 70, 30 in the medium term.
Rajat Kumar
So this also means that there could be some small lever to your budget or basically yields if the emerging kind of loan book goes up.
Rishi Anand
Sorry Mishan Bila to repeat that please.
Rajat Kumar
So this also means that there could be some small lever to yields if your emerging book goes up.
Rishi Anand
Yeah, yeah, absolutely. The two levers that we have got to yields is obviously pushing more business in emerging BNC1 and the second lever is actually as Rishi said lap if we can take the disbursements rates in a calibrated MANNER Back to 28 to 30% that is a good percent. And third is our, our overall strategy where we always tell that always have guided that self employed business will as a percentage of the AUM will move towards self employed from overall book will move towards self employed by one 1.5% every year.
And the more emerging BNC that we do, the more self employed business that we will underwrite. So I think this all works out to a slightly higher yield generating strategy.
Rajat Kumar
Thank you very much
Rishi Anand
And thank you for patiently answering all the questions. All the best. Thanks Ashik.
Kunal Shah
Thank you. The next question is from the line of Rakesh Kumar from Valentis Advisors. Please go ahead.
Rajesh Viswanathan
Yeah, hi. Thanks sir. So the first question is you know with regards to the funding sources, so just wanted to know that in the last one year or so like in this declining interest rate scenario, so what portion of non banking funds would have got repriced and to what extent?
Rishi Anand
A significant portion of our floating funds are only banking funds and NHP funds and NHB also approximately 50% of our NHP is fixed and 50% is floating. So that NHP floating portion will always get repriced. It would have got repriced in the range of about 50 60bps if I’m not mistaken NHP. And in the terms of banking funds I think banking funds once I’ll just get the number to you. The banking funds would have got in terms of BIPs it would have got repriced by in the range of about 50 bips
Rajesh Viswanathan
And the non bank. So like from like from Q4FY25 to Q4FY26 we have a drop of approximately 80 bits of interest rate. The borrowing cost number.
Rishi Anand
Sorry, come again.
Rajesh Viswanathan
The interest rate number for us, the diversified funding number that has fallen
Rishi Anand
From 8.4 to 7.6. That’s right, that’s the incremental. That is the incremental cost of fund has fallen from 8.4 to 7Point6 and the benefit which has been passed on to the banks to us is about anywhere in the range of 70 to 75 bits. It was not 50 bits, it is 70 to 75 bits.
Rajesh Viswanathan
So if I take like 75 bits and so basically 30. So out of this 80 bit 35 bits benefit has come from bank. That is what you are saying?
Rishi Anand
Yeah. The other way of looking at it is my exit cost of funds in last year was 8.14% and the exit cost of funds in the current year is about 7.72%. So that is the, the benefit of the entire book that has actually come through to us and we have passed on 15 bits to the customers. Also
Rajesh Viswanathan
Passing on to customer is just like. So this is the secondary thing. So what I’m just trying to understand is that non banking resources that we have what portion of that can get further repriced and to what extent. So, so that is what I wanted to arrive at.
Rishi Anand
See our NCDS is about 22% is our NCD. So NCT is typically a three year, four year NCDs which typically don’t get repriced. These are all, these are NCDS are broadly, broadly fixed type of instruments. Now it comes to banks. Banks are 51% which gets repriced which are all floating rate NHB as I said 22% is NHP, NHP 50 is floating, 60% is fixed. Now NCDS will also include a small portion which will, which will also get fixed. So typically out of our NCDs approximately 15 to 16% will get one thing of the NCDs.
Of the NCDs 32% sorry, my bad. Out of the NCDs 32% is floating and 68% is fixed. So we have 22% of our overall portfolio borrowings is NCDs. Of the NCFs 32% is floating and 68 percent is fixed. Okay, okay, okay. Sure, sure sir. Thank you.
Kunal Shah
Thank you ladies and gentlemen. That was the last question for today. I now hand the conference over to the management for closing comments.
Rishi Anand
Thank you all for coming in quite late for this, for this call and I hope that we have been able to answer and manage to answer all your questions as per your expectations. If there are any pending questions you can always reach out to Sanjay Mullsadani, our head of FP&A and we’ll be happy to answer these questions. Thanks and happy to meet again in quarter one of the next financial year. Thank you very much. Thank you so much.
Kunal Shah
Thank you. Ladies and gentlemen, on behalf of GM Financial institution securities limited that concludes this conference. Thank you for joining us. And you may now disconnect your lines.