Aptus Value Housing Finance India Ltd (NSE: APTUS) Q1 2026 Earnings Call dated Aug. 01, 2025
Corporate Participants:
Unidentified Speaker
M. Anandan — Executive Chairman
Balaji P — Executive Director And Chief Financial Officer
Analysts:
Unidentified Participant
Mona Khetan — Analyst
Kunal Shah — Analyst
Rajiv Mehta — Analyst
Renish — Analyst
Shailesh Kanani — Analyst
Kushan Parikh — Analyst
Amit Jay — Analyst
Manik Bansal — Analyst
Aman Vishwakarma — Analyst
Dixit Sha — Analyst
Jainis Chheda — Analyst
Presentation:
operator
It. It. Sam. It. Ladies and gentlemen, good day and welcome to the Aptos Value Housing Finance India Limited Q1FY26 earnings conference call hosted by Dalut Capital Markets Private 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 STAR and then zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Ms. Mona Ketan. Thank you. And over to you, ma’.
Mona Khetan — Analyst
Am. Thank you. Nidhi. Good morning everyone. On behalf of Dallas Capital, I welcome you all to the earnings conference call of Aptis Value Housing Finance to discuss its Q1 SR26 performance. We have with us the senior management from Aptis to share industry and business updates. I would now like to hand over to Mr. Anandan for his opening comments. Thank you. And over to you, sir.
M. Anandan — Executive Chairman
Thank you, Mona. Good morning ladies and gentlemen. I’m Anandan, Chairman of the company. I welcome you all to discuss our performance for the quarter ended June 25th. I’m joined today by Mr. Balaji T. Balaji, M.D.C.P. manoharan, CBO, Sanjay Mittal, CFO and Amit Singh, Industrial Relations. We are pleased to share that Q1 FY26 was a stable quarter for us marked by continued focus on maintaining consistent growth. We are happy to share that our long term credit rating was upgraded to CARE WA from WA minus a recognition of our financial strength, growth, prudent risk management and consistent overall performance.
We continue to enjoy broad based support from all financial including banks, NSB mutual funds, BFIs and two insurance companies as well. During the quarter we brought an ROA of in excess of ROG of in excess of 20%. A milestone and reaffirming the strength and resilience of our operating model. Our robust sustainable roas are supported by a well diversified product mix and the consumer base with varied income profile providing stability across market cycles. Aligned with our vision of scaling our AEM to 25,000 crores by 2029. We are steadily investing in branch expansion, digital capabilities and strengthening the talent pool particularly in the building management level to build capacity for long term scalable growth.
With that I would like to hand over the call to Mr. P. Balaji to take you through the business focus key operating and financial parameters. Thank you.
Balaji P — Executive Director And Chief Financial Officer
Thank you, sir. Good morning to all. As we have been explaining in the earlier calls, we will continue to focus on key strategies namely diversified product and customer mix, ensuring stability. We will continue to grow across housing and small business loans catering to varied customer base across varied income levels, especially in tier 3 and 4 cities. This diversification supports resilience across market cycles. Expansion into the states of Maharashtra and Odisha this is gaining traction Strong base in southern markets with early success in Maharashtra and Odisha. We are expanding operations continuously in these. States and deepening penetration in existing geographies through new branches in Maharashtra and Odisha. Our loan book has crossed 67 crores. The initial experience in these states have been good and going forward more accelerated growth will be pursued in the ensuing quarters. Discipline led Customer acquisition and efficiency gained about 21% of our Q1 FY25 business originated through referral, app construction, ecosystem, app and social media, thus complementing our vast branch Network. The mobile first lead management platform which we launched in April 24th is streamlining operations, enhancing compliance and boosting collection productivity. Continued focus on productivity and cost efficiency Maintaining sharp focus on operational productivity collection, OPEX and cost of funds supported by data driven decision making and continuous system improvements.
Now coming to the major performance highlights for the quarter on the business growth and scale, AEM grew by 24% year on year to 11,267 crores. Disbursements for the quarter stood at 775 crores, up 15% year on year but down 27%. The recent project I will explain shortly. Our customer life customer base has crossed 1.65 lakhs reflecting 20% year on year growth. Branch networks to the 301 branches as of 30 June 25. Now coming to the asset quality Asset quality scenario was slightly impacted by seasonality leading to 19 basis points rise in our GNPU to 1.49%.
Net NPA was at 1.12%. Provision coverage on the NPA was at 25%. Now coming to the profitability and efficiency, the net income margin was at 13.4%. Opex to assets was at 2.7%. Despite ongoing investment, the credit cost was sequentially up by 8 basis points to 38 basis points but remain under our 45 to 50 basis points guidance card for QNSI 26 was at 219 crores marking 28% year on year growth. ROA was at 7.9% and ROE was at 20.1% which is unmatched in the segment. On the disbursement side, we experienced a dip in our business activities largely on account of seasonality.
April and May are typically lean months for construction activity due to combination of various factors like summer heat, payment of school fees and vacations. This naturally leads to a slower on site progress which in turn affects business months especially for construction plants in the first quarter, especially for the construction link products. While these were the challenges in April and May, June and July were normal months reflecting the resumption of construction activity and and stabilization of internal process. Based on the normalization in the months of June and July. We are confident of growing steadily in the coming months and to be further supported by steady demand environment.
Notwithstanding the above, we delivered a healthy 24% year on year growth in Asia. Now coming to the funding side. In Q1 we raised 250 crores through NCDs placed with mutual funds thereby diversifying our funding. Current borrowing mix are 52% from bank, 14% from NHB, 21% from NCB basically issued to insurance companies and mutual funds and the remaining through securitization. In order to continue the diversification of liabilities, we did direct assignment transaction of 135 crores in Q1 helping us manage ALM and strengthen our PDC. We maintained a strong balance sheet liquidity of 1,532 crores including 1,015 crores of undrawn bank functions reflecting the growing scale and self reliance of our NBSC.
Since March 2024 all fresh borrowings have been raised without support from HFC guarantees. Guarantees on existing loans starting with a leading private sector bank have also been removed with similar steps underway across other lenders. Now with these remarks I open the floor for the question and answer session. Thank you.
Questions and Answers:
operator
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 their touchstone telephone. If you wish to remove yourself from the question queue, you may press STAR and two participants are requested to use handsets while asking a question. Ladies and gentlemen, we’ll wait for a moment while the question queue assembles. The first question is from the line of Kunal Shah from Citigroup. Please go ahead.
Kunal Shah
Yeah. Hi sir. So firstly on the growth side you. Indicated the specific reasons for a slower growth in 1Q but if we look at the overall disbursements, monthly disbursement trends, where we are currently and how should we expect to end FY26 and you indicated indicated that it will be a steady growth here on normally we used to guide for 25 to 30 odd percent kind of a growth. We have come down below 25% now. So where should it ideally settle? Would it be at the lower end of the guidance or maybe even like say less than the guidance is what we are expecting. Looking at the overall operating conditions or at any point in time we would again aim for 28 to 30 odd percent growth as well in the near term or over the medium term.
Balaji P
Looking like this, if you look at the first quarter disbursement which is slightly subdued but if you look at my June and July disbursement, it has come back to normalcy. And in fact if you look at the last year’s disbursement, the average monthly disbursement was around 300 crores. But in June and July the average monthly disbursement is almost at 340 to 350 crores. Which means that is giving us good confidence of pursuing a very strong growth on disbursements. That is the first thing. And going by this, I mean if you look at it normally the second, third and fourth quarter are more stronger quarters than the first two quarters.
But with more branches coming in with more improvement in productivity in terms of number of files logged in and number of increasing the APIs and also more contribution from Odisha and Maharashtra. Definitely we will be able to clock disbursement growth of around 22% for the year. And if you look at the if you have won the guidance on the loan book, normally if the disbursement growth is around 20 to 22% there will be a 6% more on the AEM growth. So that is what we are targeting. So which is around 28, 29%. So that is what is likely to happen for this year.
Kunal Shah
Okay great, that helps. And secondly if you can just highlight. In terms of the collection efficiency seasonally being lower and even maybe 30 DPD as well as GS3 in finger more like Q1 phenomena. But any particular trends which you are seeing between the business loans lab and home loans or maybe the increase is similar across all three categories. So because there are like lot many players highlighting stress on the MSME side on the self employed side. So are we seeing any abnormal increase in the other segments X of home loan?
Balaji P
Actually ASCAT is concerned we are not seeing that kind of what other companies are indicating. We are not seeing that kind of a pressure on the collections. It is basically because the quality of our customers is we are four notches above maybe an MFI or a small ticket loan providers. And also if you look at IT and the LPD for our loans are only 40% which means the equity of the customer in the property in which they live is much more. So this is Aiding us in the collection efficiency. It is basically April and May.
There was a shortfall in collections. That’s why our quarterly collection efficiency was at 99.12% as a G last quarter of 1, not 1%. But in the month of June and July, the collection efficiencies have come back to normalcy. And going forward we’ll be seeing more improvement in that. Over and above that, we also got this Sarpassi benefit where reposition under Sarpassee might be difficult, but at least it makes people come to the negotiation table for getting a settlement in place and getting the NPA settled. So all these things will help in improving the collection efficiencies and also the NPAs.
Kunal Shah
Okay, thanks. Thanks. And all the best. Yeah,
Balaji P
thanks.
operator
Thank you. The next question is from the line of Rajiv Mehta from yes, securities. Please go ahead.
Rajiv Mehta
Yeah. Hi, sir. Good morning. Congrats on resilient performance. But again, just continuing on collections. Can you share some data on collections of June and July? Or maybe just to understand that whether are we normalizing or have we normalized already in June, July in terms of our collection efficiency? Or maybe you can share the bounce rates. Have they come back to normal levels?
Balaji P
If you look at it, I cannot, obviously, Rajiv, you know that we cannot share the numbers as of July. All I can say is July collection efficiencies. In fact, June collection efficiencies itself has come back to normalcy.
So in June, the collection efficiency was almost at 99.5, 99.75. So that is one thing which gives us confidence that our collection efficiencies are improving. And, and that’s the guidance we can give as of now. And definitely we are on the job of improving the collection efficiencies and reducing the NPAs. And over and above that, we are also strengthening the collection scheme in the sense we are also identifying space in charges for each of the collections and who drive the collection officers that will bring in more productivity. In terms of the performance of these. Collection officers.
Rajiv Mehta
How would this recent rating upgrade and plus Varepo and NPLR cuts manifest in our overall cost of funds in the coming quarters? And what would we do with that benefit? Would we at some point in time and when would we evaluate cutting lending rate or would we kind of retain the benefit of the spreads and for how many quarters?
Balaji P
If you look at the total borrowings, 56% of our borrowings are variable rates and 44% is fixed rates. And again, out of this 56, 30% is linked to MCLR and 26% is linked to external benchmark rate.
So if you look at this 26% of the borrowings which is linked to the external benchmark, we have already got a 0.25% reduction which translates, I think that’s where it’s from. 8.68 the borrowing cost has come down to 8.64. So the balance 0.75% repo rate cut which has to be passed on to us, that will come in the second quarter, which means on a total it will be 0.2% reduction in the borrowing cost. Over and above that with MPLR link to borrowing, it will have a lag of three to six months. So with the result by the year end we should get at least 0.4 to 0.45% reduction in the borrowing cost on the existing borrowings.
On the borrow, yes, that is one. Next thing is if you look at the incremental borrowings earlier in the housing finance company we used to borrow between 8.6 to 8.7%. Now it has come down to 8.05% to 8.1%. Again if you look at the nbsp borrowings it was earlier at around 9 to 9.25. That has come to around 8.5% now. So the incremental borrowings, there is a good reduction in the borrowing cost. And of course considering the fact that 80% of our customers next is on the rating upgrade, obviously rating upgrade will help us. Of course we are also pursuing with ICRA for another, I mean the rating upgrade from them as well.
And also that will open up avenues from raising money from insurance companies and mutual funds. And also we are also in the process of diversifying the borrowings. And also it is all long term borrowings. Basically we are borrowing between five to seven years and the diversification is from the borrowing from insurance companies, mutual funds. And of course we are also doing a bit of direct assignment. So all this is going to reduce our borrowing cost. And in terms of passing on the interest rate, if you. So if you look at it on the total book, 80% is fixed.
So as of now we are not contemplating any passing on of benefits, but maybe variable rate we might consider. So that’s the standard of now.
Rajiv Mehta
Got it sir. Thank you so much.
operator
Thank you. The next question is from the line of rinish from icici. Please go ahead.
Renish
Yeah. Hi sir, congrats on a good set of numbers. Again just happening on this, you know, spread thing. Just correct me, you said that our exit cost of borrowing will be 40, 45 basis point lower than the current level of 8.62.
Balaji P
Yeah.
Renish
Okay. So then these, this entire, you know, 40, 45 basis point of spread expansion and ultimately it will go into your roa. But we will not think of passing on anything to customer. On the, on the fixed rate side.
Balaji P
We have still not got full benefit of this cost of funds reduction. We just got 0.06%. So we need to think through, I mean let’s first let the reduction come in. Then we will have to think through on what we need to be passed on the asset side. Yeah. As of now, this contract, we might not even consider passing on the benefits.
Renish
Got it. The reason for asking this is, you know, I’m just looking from a steady state ROE perspective, you know, so we are already, you know, more than 20% ROE now. And with this spread benefit, you know, coming in, where do you see, you know, ROE settling in medium term? I mean are we aspire to deliver 22% ROE or you know, will sort of remain at 20 and then incrementally we’ll invest.
Balaji P
Our objective Is to cross 22% as fast as possible. So that’s what is. Let’s see what we need to do about that.
Renish
Got it, Got it. Okay. And just lastly, you know, on this AUM mix side, so if you look at last three, four quarter strand, you know, the insurance top up loans, you know, has been growing little fast obviously on a small base. But when we look at in absolute terms it is now 650 crore versus 360 crore in Q1FY25 last year. I just wanted to understand, you know, sort of what is the underlying thing driving this growth, you know, on the insurance and suburb loan. And if you can just briefly tell us the underwriting metrics for the top up loans.
Balaji P
See if you look at the percentage of insurance loans on the top of loan, it has ranged between 2 to 3% of the total AM. So insurance loans as you all know, it is basically given for the purpose of covering the credit life of the credit shield insurance which is around 3 to 4% of the pension amount which we paid as premium to the insurance company for the entire tenor of the loan. So it is a situation like since it is 4% of the sanction amount, the customer might not be able to bear it. And because of that we are treating that as a loan and obviously that is getting recorded as a non housing loan.
So that is the characteristic of the insurance loan. If you look at the top up loan, we have a clear set of guidelines on what constitutes top up loan? For example, a person will be eligible for a top up loan only if he has not bounced for the last 12 months. And of course at the time of giving the top up loan we do a credit bureau analysis. Again the credit at the branch goes and visits the customer to find out if repayment ability and all those things are taken into consideration before the top of loan expansion.
So it is not that we are just wanting to increase the top of loan. It is basically the customer has to satisfy the whole lot of conditions before he becomes eligible for the top up.
Renish
And sir, when we, when we say. 12 monon, you know, bound. So basically even if a customer is in one plus BPD will not give him a top up loan, is it?
Balaji P
Yes. He should not have bounced for the last 12 months.
Renish
Yes. Okay. And what is the minimum vintage? He or she should be on our platform.
Balaji P
He will become eligible after one year.
Renish
After one year. Okay. Okay. That’s it sir. Thank you. And that’s it.
operator
Thank you. The next question is from the line of Shailesh Kanani from Centrum Booking. Please go ahead.
Shailesh Kanani
Good morning everyone and thanks a lot for the opportunity. Congratulations. A great set of numbers considering the macro environment. So two questions from my side. One is on asset quality. We have been hearing from a lot of lenders about specific geographies like Andhra, Tamil Nadu. If you can throw some color in. Terms of any pockets or any region. Specific where we are seeing any pain points. We also highlighted that we have strengthened the collection team. If you can highlight something on that front. And second, Anand also talked about adding talent. If you can throw some color, some. More depth into how we are seeing. The kind of growth we are posting. So how we are trying to build. Up the management team
Balaji P
we are not seeing experiencing any kind of problems in any kind of area specifically. So that is one thing which I want to communicate here. So we are not finally experiencing that kind of an issue in any of the areas. It’s basically April and May being a lag. I mean the collections got impacted. Otherwise there is no other thing. And the next question, collections. In order to prepare the organization for the next level, we are strengthening the collection team. While the collection offices we have got around 600 people on ground. There should be somebody who closely monitors them.
So sitting in head office, the state head cannot be monitoring all of them. So that is the reason why we have brought in the middle management in the state in charge category so that they can closely monitor the performance of these collection officers. So that’s the whole that is one thing. Now if you look at the entire talent pool, we have got this management committee who is having the heads of departments of various departments in the various departments. But below that we wanted to strengthen the organization to take the organization to the next level. That’s why we have identified status across.
I mean for the sales, I mean every state. The responsibility of the state head is to run that state like a CEO of that place. So you have to be in charge of both collections, growth, quality and also departments. So that is one thing is the responsibility of the stated. And if you look at the credits there also we have identified state who will be responsible for each and every state. And under them there are four, five or six people will be processing these files and transferring the files. Similarly, we have identified in legal, technical and collections as well not only the department heads, but also state heads and also state in charges.
So that is on the strengthening of the organization and in terms of support, whether it is finance, operations, compliance, assurance functions. There also we are strengthening the. So that the company can perform well. It also including technology as well.
Shailesh Kanani
Thanks a lot sir. That is. That is very helpful. So the collection team is business as usual. As we are growing. That is the addition what we are doing right? Is that the current understanding?
Balaji P
Yeah.
Shailesh Kanani
Okay. So one question to Ananda sir. Ananda sir, how do you. How satisfied are you with the current. Performance giving the macro and are any. Concerns near term, medium term, long term in the business model? If you can highlight anything, because our. Book is quite seasoned. We have seen multiple cycles. Any comments on that front? If you can give it. And that’s all from my side.
M. Anandan
Let’s look at that in two ways. One is if you look at the. Opportunity and the market size in terms of underserved, unserved market, particularly in cities. So at a broader level we have got a long way to go and there’s a long Runway for growth from the demand side. And we don’t see that only after I don’t see others also seeing any major issue in terms of the demand from the customers, particularly for the affordable housing parent segments service, you know, coming from the tax credit. So the demand I would say continues to be robust. And we believe that we continue to. Be for quite some time. As the development takes place in the Tier 3 and Tier 4, more development takes place. But coming to the other part, in. Terms of the challenges of this demand of growth to materialize, there are two aspects, critical aspects which are emerging is really one is the. One of the major challenges not only for Us for others also is that our ability and the ability to retain the manpower and grow them quality wise and without compromising on the productivity. So that is where these attrition levels. Comes into play, particularly at the field officer level. So in other words the HR will be one particular level whether it is in sales and collection. That will be a challenge that you know is very highly focused in terms of why our attrition level is really almost very low at the senior most level and middle management also is low. But our attrition level continues to be slightly higher than we field level. Our own standards particularly self service functionality level. That’s what we are working through retail. So that part of the growth has. To come from the improvement in productivity. As Balaji also mentioned in terms of the number of files or quality of collection that we do. So that I would say is one challenge that we have to face. Second is the emerging competition because as you know the affordable housing finance segment started attracting attention of more players whether from the banks or from the standalone HFCs or from the emerging small finance banks. Their own focus to shift more towards security based product than the unsecured one like microfinance. So the competition will emerge. This is where Apples is trying to really play a very important role in terms of our product and continuous growth and then try to have the early more advantage.
Try to be a leadership in the local market and try to be very it also comes into play we want to keep the best staff just to outdoor sales service turnaround time and other turnaround time. But during the loan period also resolved if there’s any customer support issues. So competition is something which also going forward in the MRP segment. But that much depends on companies like. Us whose focus is only in this segment. Largely single product focusing on segment. We hope we will be able to. Do much better than others who are multi product, you know on the side, on the other side on the advisory side like a typical bank for them various type of customers. Can I give them all a problem? So that’s all we wanted to but these two we see as the challenges going forward.
Shailesh Kanani
Thanks a lot sir. Thanks a lot. That was very useful and best of luck.
operator
Thank you. The next question is from the line of Kushan Parikh from Morgan Stanley. Please go ahead.
Kushan Parikh
Thank you for taking my questions. I just have one question and two data keeping questions. So the first one is essentially on the assignment. So over the past two quarters we’ve started doing direct assignments. So just wanted to understand how we are looking at this piece going forward. And what should we expect from from a steady state basis in terms of. The. Pace of direct assignment going forward? Because quarter on quarter that has nearly doubled in one queue. So just wanted to understand on that the income from the assignment. And secondly a couple of data keeping questions. If you could just repeat the incremental borrowing cost that you are seeing at the NBSC and HFC level. Sorry I missed. And second, thirdly, the reconciliation on the operating cost between the NBSC subsidiary and the console level because at the NBSP subsidiary over the last two quarters we have seen higher operating costs. However, at the consolidated level that remains pretty much in line with the historical trends.
Just wanted to understand if there is some reapportionment of the nbsp.
Balaji P
First on the direct assignment we have decided on the direct assignment as a revised funding strategy in the sense that one thing is diversification of funding, the other one is it is meeting the ALM criteria. And third one is it will improve our principal business criteria. So if you look at our direct assignment it is only the non housing loans that that gets done as a. Direct assignment that gets sold to the investors. And if you look at our policy it will be around 10 to 15% of our disbursements will be done as direct assignment which will come to around 2 to 3% or 4% of our loan book. So that is the strategy with which the DA will be continued over the quarters. Now the next question is on the what is your next question on the incremental cost of funds? Incremental cost of funds. If you look at the HFC earlier, before the reported cut we were getting loans at around 8.6 to 8.7%. Currently we are raising funds at 8.05 to 8.1%.
And if you look at the NBSE earlier, before the reported cut it was around 9 to 9.25%. Now we are raising funds but 8.5 to 8.6%. So that is our incremental cost of funds. Next thing is. What is the next question?
Kushan Parikh
Yeah, the next was on the OPEX between the NBFC and the consolidated level. But just before that one follow up on the incremental borrowing cost. This the reduction in the incremental borrowing cost is purely due to the cuts. So we are yet to see any benefits from the rating upgrade. Is that fair understanding? And that is also coming
Balaji P
the rating. Update came very recently. We are also proceeding with Citra. So one that the benefit of the rate cut, sorry, rating upgrade will have to approve in this quarter. We are also negotiating hard with the bank on that.
M. Anandan
Just to add a point on the we have seen given the macro situation in terms of liquidity and lower retail credit growth by the banking system, there are now realization in certain quarters in some banks of offering at a very very competitive rate. In fact last week we got a loan of almost about 300 crores from one bank at a rate of our company at a rate of 8.05% and it is a long term loan and so it is one now started seeing eight and maybe going forward slightly as well as for new assignment.
Kushan Parikh
That’s helpful. Just lastly on the operating cost.
Balaji P
Yeah the operating cost we have a clear apportionment policy. Basically this based on the A proportion and there is a slight more increase in the A in the NBSE and than the hse. That’s why the costs are getting more absorbed there. Regarding the nitty gritty, I can share the computations maybe later with you then. We can talk on that.
Kushan Parikh
Sure. This is answered. Thank you.
operator
Thank you. The next question is from the line of Amit J from Javadi Partners. Please go ahead.
Amit Jay
Thank you for the opportunity. Sir, I have a fairly basic question and you know, allow me some rope here but this is regarding the asset quality on slide number 34. So we have mentioned gross NPA and 30 plus DPD rates. I was trying to correlate, you know these two and we’re trying to make sense of it. So let me just say broad numbers. So particular DPD as in Q1FY26 is 6.45. So let’s say 6 and a half percent and gross NPA is 1.49 that is 1 and a half percent. So to my understanding particular GPT is like, you know, people who have not paid the two amounts in the 30 days.
And Ross NPA is like people who are not paid beyond 90 days. So is this understanding correct that you know out of this six and a half percent which were not paid within 30 days they will pay up. Five percent of those will pay up in the next 60 days and that’s how our gross NPA is around C one and a half percent. So is that understanding correct, sir?
Balaji P
Yes, in the sense 30 plus is 6.46 and NPA is 1.49 which means the balance 5% they pay before it becomes an NPA. And also under the RBI rule, once in NPA unless all the odds are cleared, then the NPS doesn’t get cleared. So what happens is either one EMI to not flow into that greater than 90 day or maybe two year night. So stay in the 30 to 60 bucket.
Amit Jay
Okay? Okay. And one follow up on that is that you know, when our 30 plus BTD is you know, pretty high, you know, 6.45 and still our collection efficiency is 99 plus. So how, how I’m not able to relate that sir.
Balaji P
Basically if you look at the collection efficiency computation, it is how it is completed that month’s collection against against that month’s due building which includes the OD collections also in the current collections. So that’s how this 99.12% is arrived at.
M. Anandan
Also just to add that actually the challenge here is really in terms of while the customers are paying the one emi. Our ability to make them to. Pay more than one EMI becomes to some more sites. So there is a cash flow of 1 EMI from the customer. But the moment they cross that 1 EMI which is become 2 EMIs, then let’s say which comes into a category of 30 60, then what happens? It will continue to be very 3060 because they are not able to pay more than 1 EMI. It does not mean, you know, it moves in NPA but the continuity being 3060 or some of them even 30 to 96, 90 also. So in other. But our challenge for us is really, I agree to your observation that for us the challenge is really to reduce that, you know, soft back end production between 30 to actually less than 90, you know, so that will happen only if you’re able to collect more than one emi. And that’s what we’re trying to do.
Amit Jay
Understood sir. One last question sir. You have given some visibility in very near term this financial year and nights. I just wanted to have your aspiration, you know, in the next say, you know, next three, four, five years and beyond. Maybe Chairman Sab md, you can make some comments. You know, how do you want actors to look like in the next five years or so? Maybe you know, if you can just, just you know, throw some aspiration, what you may have in your minds, fine.
Balaji P
If you look at it, the market opportunity for either the affordable housing or the small business loans in which we are in is very huge and it is promising a huge Runway for growth. But considering the fact that these guys are more kind of at least the perception rise to more risky customers, the credit underwriting has to be very, very strong. So to that effect Aptus will be a credit driven company rather than a very high level growth driven company. So that is why if you look at our original guidance, even in our Chairman’s remark we have guided a 25,000 crore aam getting reached by FY28 or 29.
So obviously for us the quality of book comes first rather than the growth. So but at the same time it is not that we will not be pursuing a good growth but this is what is the growth guidance. So maybe by yourself 28 or 20 years down the line or 4 years down the line we’ll be reaching this 25,000 crores. But impeccably good results, good performance numbers, good operating numbers.
Amit Jay
Right sir, the other stickers I will also have to just. Even if we just take inflation into account that average ticket sales should go on increasing. Am I right? Or you also have a vision to include larger ticket sizes or you want to stick with the current inflation adjusted.
Balaji P
Definitely we want to increase the average. Ticket size in line with the inflation but not to the extent of going up to maybe 1620 lakhs kind of an average ticket size. So this is the sweet spot we are in. So we will be increasing the average ticket size. In fact that is one of the growth levers that is coming in for us. So we will be increasing the average ticket price by 50,000 to 1 lakh every year. So that is going to contribute to our growth of at least 10 to 1%.
Amit Jay
Thank you sir.
operator
Thank you. The next question is from the line of Maneek Bansal from Master Capital Services Ltd. Please go ahead.
Manik Bansal
Hi sir. Thank you for the opportunity and congratulations on good set of numbers. So our ROA has improved from 7.7 to 7.9%. And there is this gain on sale of financial instrument as well. So how much of it is at. This increase of 20 bits attributable to say improvement in the cost of borrowings and attributable to this bay non financial instruments.
Balaji P
You are not clear on your question. It’s not able to clear you properly.
Manik Bansal
Okay. Okay. My advice is. Hello.
Balaji P
Yeah.
operator
Yes sir.
Manik Bansal
Yeah. So I. I just had a basic question. The ROI has improved from 7.7 to 7.9%. Q on Q. Right?
Balaji P
Correct.
Manik Bansal
And that is attributable to say there is a gain on sale of financial instrument as well. So how much of this improvement in RO is attributable to that gain on. Sale of financial instrument and how much. Is due to that improvement in cost of borrowings?
Balaji P
So basically it is explained in the Roe 3 where the revenue from operations which was earlier at 17.8 it is at almost the same levels at 17.7. If you look at the gain on the recognition of financial Instruments that is around 1.1%. The other income has remained stable at 0.4%. And if you look at the interest cost on the AEM earlier in the last Q1, FY25 it was at 5.4. It has increased to 5.8 resulting in NIM. From 12.8 it has become 13.4. OPEX has remained constant at 2.7% in both quarters.
Of course credit cost has gone up from 0.2% to 0.4%. And the after tax impact of all this has increased from 7.7 to 7.9%. Mr.
operator
The participant has got disconnected. Can we move to the next participant?
Balaji P
Yeah.
operator
The next question is from the line of Aman Vishwakarma from Philip Capital. Please go ahead.
Aman Vishwakarma
Yeah. Thank you for the opportunity and congrats on a good set of numbers in the tier one. I just had one question for the management and which is on the competitive intensity in Odisha and Maharashtra. So as of FY25 closing we were at 54 crores of AUM there. And in Q1 we are at 67 crores. Right. So I just wanted to understand is there a reason why we have kept the disbursement rates at the lower end considering we have also done 700 crores of disbursement in the entire quarter. So just sense or some color on what’s happening on the ground in Odisha and Maharashtra would be helpful.
Thank you. That’s all.
Balaji P
If you look at our expansion strategy, it is always a contiguous expansion strategy. And when we venture into a new stage we don’t want to grow very aggressively. We would like to understand the market, understand the people, understand the culture of the people. Even if I have to spend one, two years on that, I will want to invest in that. And then once I get good confidence then I will grow fast in these states. So that is what has happened. If you look at it, of course the loan book is at 67 crores. But the thing is we have got now good confidence in these two states.
With the cluster managers more promising. With the people in our company also more promising to perform, we will be opening more branches and also recruiting more people. And considering the low book price, the competition is not a big problem there. So we just have to grow our book that will be concentrated from the second quarter onwards.
Aman Vishwakarma
Okay. And for this one follow up question here, could you just give us what. The collection efficiency has been in these two states and is it any different than what we are experiencing in Andhra or the other states?
Balaji P
Oh, it is not typically different across states, it is almost. It can be 0.1, 0.2% here or there, but it is almost the same.
Aman Vishwakarma
Okay, thank you sir.
operator
Thank you. The next question is from the line of Mona Kitten from Dalit Capital. Please go ahead.
Mona Khetan
Yeah. Hi sir. Good morning. So two questions. Two, three questions from my side. Firstly, you have always maintained the out rate of about 2 and a half x of own money coming in. Right. So I’m guessing the number is similar. Correct.
Balaji P
What is the question?
Mona Khetan
The BT out balance transfers. Yeah, yeah. So the question is, is there any geography specific specific in terms bias in terms of it coming from tier one cities or. And also where does it go to both whom does it go to in terms of which financier and also where in terms of, you know, tier one, tier two, where does these transfers typically go to?
Balaji P
As you rightly said, it is still between 2 to 2.5% only. And I mean we are not seeing any specific locations where their balance transfers are happening slightly on a higher note as compared to other places. So it is almost even across state. So that is not the thing. But if you look at the loans that are getting taken over, it will be either a small finance bank or an nbfc. Those are the companies who are taking over. Maybe they are giving a higher loan at a lower interest rate. That is what is the thing which we are observing.
But considering the fact that it is just 2.5% and this has remained stable over the last 10, 15 years. So we are not too much concerned about that.
Mona Khetan
Sure, got it. But even in terms of the. So I’m not referring to statewide bias but in terms of tier one versus tier three, tier four cities, is there any bias that it happens more in Tier 1 locations?
Balaji P
If you look at, I mean we are not primarily in tier one. Even in tier one, it is basically the outskirts. So we are not seeing that kind of an impact in either of these places.
M. Anandan
Just to add to what basically we are not really seeing any profile like geography wise, are they, you know, are the customer end use wise or you know, service they are in, Are the customer income source wise or geography wise or in terms of loan size, lower loans or higher loans. Like we are not really seeing any pattern of this preclosure of 22 and a half percent. So you know, as of now we don’t really see any specific workable, you know, concentration that way. That’s one aspect. 17 Other aspect in terms of the takeover launch also goes to largely not to the bigger banks either.
It is the small Finance banks or the larger, some of the largest receptors, you know, so that the big banks are not in the picture. Yes,
Mona Khetan
got it, got it. That’s helpful. Secondly, I just want to touch a bit on the CC recovery. So if I have to look at your history of the last 12 years, if you could just throw some light on how many loans have gone through and what is the you history on recoveries we’ve had around that that will be helpful.
Balaji P
Yeah. Actually if you look at FRC anything beyond 90 days we initiate FRC action for our housing finance company customers. So that is a normal process which our legal recovery team takes care and we initiate the process. And as you know it is a time bound process. I think the minimum to get a minimum time to get an order is six months. But of course on ground it doesn’t take six months, it takes more than that. But one thing is I think within one or two months we can issue a symbolic position notice and using that symbolic portion notice we talk to the customers for coming to the negotiation table and based on that we might give some waivers on the charges or the overdue charges or disclosure charges while we might not give waivers on the principal or the interest and based on that the settlements happen.
So basically recoveries will not be that great. But using purposes, the recoveries using negotiation with the customers are much more. So that’s the scenario.
Mona Khetan
And also if I have to look at your portfolio between. So I’m just trying to understand when it comes to this small ticket segment what has been your experience between salaried and self employed in this segment which is in the 7 lakh kind of ticket size or 8 to 9 lakh kind of ticket size, has your experience been better on the self employed side versus salaried or any differentiation you see or there’s none in your particular portfolio, any color will be very helpful.
Balaji P
If you look at our self employed customers proportion, it is almost 78% of our total customers and 22% is salary. Again this 22% salary is what I mean if you look at that family income, one person will be earning a salary by getting maybe a cash salary or they may be working in a small establishment, the other person will be doing a business. It’s basically the income of these two combined and then that gets classified as salary. So basically speaking we are not seeing that kind of a variation in terms of repayment whether it is on a self employed or a salary kind of a thing.
Mona Khetan
Okay. Okay. No differentiation in your portfolio. Okay. Okay. Just two data keeping questions. What was the quantum of assignment during the quarter and what is the OnePlus BTD?
Balaji P
Quantum of assignment was 135 crores during the quarter. One plus BPD is 8.5%.
Mona Khetan
Thank you. That’s. That’s very helpful. Yeah. All the best.
operator
Thank you. Ladies and gentlemen, please limit to one question for participants and rejoin the queue. For the follow up question.
operator
Thank you. The next question is from the line of Dik Shah from Ascendancy Capital. Please go ahead.
Dixit Sha
Hello. Am I. Am I audible?
Balaji P
Yeah.
operator
Yes.
Dixit Sha
Yes. So first question was on data fitting point. What was our individual housing preparation? As on. As on.
Balaji P
Not clear. Your voice is not clear.
Dixit Sha
Now. Hello.
Balaji P
Slightly better, but you go ahead with the question.
Dixit Sha
What was the percentage of the AUM in individual housing loans?
Balaji P
Individual housing loan on a consolidated basis it is 61%.
Dixit Sha
Okay. And on the. On the HX side.
Balaji P
On the
Dixit Sha
side on the
Balaji P
72%.
Dixit Sha
Okay. 72. Okay. Okay. Sir, one data keeping question also I. Wanted to know just a clarification. The BT out rate, what was said was 2 to 2.5%. Was that right?
Balaji P
Yes.
Dixit Sha
Okay. Now with respect to the growth on Maharashtra and Odisha, what will be our branch additions that they are planning in the say current year and say in. The next two, three years. And what would be the proportion of the AEM that we would want to look at it? Say maybe two years down the line, three years down the line.
Balaji P
If you look at the current network of branches in these two states, it is around 10. In this year we’ll be opening 10 more, that is 5. And going forward another 10 or 15 will get open maybe next year. So that is the growth path we have got for these two states. Because the experience has been good as of now. So we’ll be more aggressive in these states.
As regards the AEM percentage is concerned, it might not be very material because it is still in the growing phase. So it depends on how much that is coming in over the thing. However, the productivity and the ATS parameters, everything will be monitored very closely in these things. So that the load, the disbursements and the AEM are merge with the maximum possible extent.
Dixit Sha
Understood? Understood. Also, can you please share the.
operator
Sorry to, but I request you to come back for the follow up question.
Dixit Sha
Okay. Okay.
operator
Thank you. The next question is from the line of J from Kemprin family office. Please go ahead.
Jainis Chheda
Good morning, sir. Sir, in terms of continuing with the previous question, in terms of PT transfer. What is the reason that you see that our duty transfer will not go up going forward?
Balaji P
No. If you look at it, if you look at our pre closures it is around 7 to 7.2% on the opening loan book. Of that 2.5% is the BP out. So the balance what if you look at this is where our kind of customers, we need to look at the kind of customers whom we are serving. These are the customers who run businesses. They are not in the salvage segment. So whenever they get the cash surplus out of their business they use that. So when they get that cash surplus from the business, first thing they do is to settle the loan.
And so that’s why if you look at our total, out of the total only 60, 70% is coming out of the own source of these customers. So the balance only gets transferred to the other customers. So these are the customers who doesn’t go every year. And also another thing is that is where our sourcing strategy which is coming in. So if you look at if your customer is sourced by a DSA or a connector, what he does is every year he shifts the customer from one company to the other company. Whereas in our case it has been sourced sourced by our own internal people.
So these are the two things which is helping us control the bth. While we encourage own source customers because actually they are good customers, you might also consider another loan for them. So that is what is giving us confidence that this 2.5% will not go up.
Jainis Chheda
Sorry, I missed the last part.
Balaji P
Now also also it said is also for the last 10 years it has been, it has remained the same at 2.5% despite various business items.
Jainis Chheda
Understood. And secondly in terms of.
operator
But I request you to come back for the follow up question.
Jainis Chheda
Just one question please. Yeah. In terms of other as. As you have mentioned that please we.
operator
Request you to come back for the follow up question. Thank you. The next question is from the line of Kushan Pari from Morgan Stanley. Please go ahead.
Kushan Parikh
Thank you for taking my questions again. So just one question. So we have seen across the quarters that growth in Tamil Nadu has been improving steadily. If you could just share some updates on how the geography is performing and where do you see the steady state loan growth for this state?
Balaji P
If you look at it, I think this has been a topic of discussion for the last three, four quarters but actually we have been very concentrated. We are working on this to improve on that. If you look at our loan book growth earlier it was around 8, 9%. That has been brought up to 15% now. And going forward also, I mean still one or two clusters needs to be collected there. But definitely we can pursue a stronger growth in Tamil Nadu. We can look at at least from 15%, at least 18 to 20% in the coming quarters.
Kushan Parikh
Understood.
operator
Thank you, ladies and gentlemen. We’ll take this as a last question for today. I would now like to hand the conference over to the management for closing comments.
M. Anandan
Thank you, Mana for organizing conference call. I would like to say my sincere gratitude to all analysts of taking time out to listen to us today. Please feel free to connect with us in case you have any further queries.
Balaji P
Thank you.
operator
Thank you very much on behalf of Dalart Capital Markets Private Limited. That concludes this conference. Thank you for joining us. And you may now disconnect your lines. It.