Aptus Value Housing Finance India Ltd (NSE: APTUS) Q3 2026 Earnings Call dated Feb. 05, 2026
Corporate Participants:
Mr. M Anandan — Founder
P Balaji — Managing Director
Analysts:
Kunal Shah — Analyst
Varun Palacharya — Analyst
Sailsh Kinani — Analyst
Ansh Mehta — Analyst
Rajiv Mehta — Analyst
Amit Ketan — Analyst
Avnish Tewari — Analyst
Rohit Maheshwari — Analyst
. Krishna Vagarcia — Analyst
Mayank Mistry — Analyst
Manik Bansal — Analyst
Dakash — Analyst
Satyam kumar — Analyst
Presentation:
operator
Good morning ladies and gentlemen. I am Swapnali, Moderator of this conference. Welcome to the earnings conference call of Aptis Value Housing Finance India Ltd. To discuss its results for the quarter and nine months ended December 31, 2025. This conference call may contain forward looking statements based on the company’s beliefs, assumptions and expectations. As of today, these statements are subject to risks and uncertainties and actual results may differ materially. At this moment all participants are in the listen only mode. Later we will conduct a question and answer session. At that time. If you have a question, please press star followed by one on your telephone keypad.
Please note that this conference is being recorded. We have with us today Mr. M. Anandan, Executive Chairman. Mr. P. Balaji, Managing Director. Mr. C T Manmohan, Executive Director and Chief Business Officer. Mr. Sanjay Mittal, Chief Financial Officer and Mr. Amit Singh from Investor Relations. I would now like to hand over the call to Mr. M. Anandan for his opening remarks. Thank you. And over to you sir.
P Balaji — Managing Director
Thank you. Good morning ladies and gentlemen. I am Ananddin, Executive Chairman of the company. I warmly welcome you all to this early call. Happy to share that the sustained growth momentum is broadly ensured by us in Q3 as well aided by stable business growth and prudent portfolio management. Looking ahead, we expect to deliver sustained AEM growth driven by new branch additions, channel augmentation, higher ATS calibrated pricing on incremental home loans. Without compromising on names, our financial remains healthy with ROE sustained about 20% level as you know, one of the highest in the industry. This performance is underpinned by diversified product portfolio and a broad customer base across income segments which together provide balance and resilience across market cycles. That I would now like to hand over the call to Mr.
P. Balaji, Managing Director to take you through the business focus and key operating and financial parameters. Thank you, Balaji.
P Balaji — Managing Director
Thank you sir. Good morning to all. To begin with, our assets under management has grown by 21% to 12,330 crores from 10,226 crores as of 31st December 25th. Disbursement for 9 months. FY26 has grown to 2,768 crores recording a growth of 9% year on year. Q3 FY26 disbursements were at 1,030 crores as against 930 crores in Q3 FY25 leading to a growth of 11%. This is despite a conscious pullback in loans below 7 lakhs. As we have been Retracing growth remains our key focus area and to activate growth momentum we are executing a set of targeted high impact initiatives.
So firstly branch expansion. In FY26 we had planned 40 branch openings, most of which are already operational. For the next financial year we plan to accelerate expansion to 60 to 70 branches. Expansion will be focused on new states and key high growth markets while maximizing productivity from the existing workforce. Increasing the average ticket size as we have been guiding earlier, we will be increasing the average ticket price on account of the following first to bring in better quality customers and also to support increase in construction cost. Third thing is optimizing lending rates in the housing loan segment.
As part of optimizing the interest rates on home loans, we have reduced the interest rate by 50 to 75 basis points on incremental home loan disbursements, leveraging the benefits from lower borrowing cost. As the rate reduction is only for the housing loan and not for any other project, coupled with the fact that it is only for the incremental customers, the impact on the spreads and NIMS is likely to be minimal on the consolidated loan book, the impact of this rate reduction on our yield is less than 10 basis points. Looking ahead, we expect to deliver sustainable aum growth of 22 to 24% driven by the above said initiatives.
Now our growth is anchored on four strategic pillars. First thing is diversified product and customer mix serving self employed customers through a wide suite of housing and business loan products with a deeper presence in Tier 3 and Tire 4 towns, ensuring portfolio stability and steady demand. Expanding beyond southern markets Building on a strong southern presence, we are now scaling thoughtfully in Maharashtra and Odisha which while continuing to strengthen high growth pockets in existing states. Productivity leveraging data driven insights and system led processes to drive higher output, better service and cost efficiency creating a truly scalable growth engine.
Digital and process excellence technology underpins our growth with targeted improvements in sourcing, onboarding collections credits and enhancing control, execution speed and accuracy. Now coming to the major performance highlights regarding the business growth and scale, AEM has grown by 21% year on year to 12,330 crores. Disbursements in Q3 FY26 grew 11% to 1,030 crores. Disbursement in nine months grew 9% to 2,768 crores. Branch network stood at 335 branches as on 31st December 25th adding 35 branches in nine months. Asset quality remained largely stable with the gross NPI at 1.56% and net NPI at 1.1.8% 30/BPD saw a slight uptick to 6.48% due to seasonal volatility in collections because of the festive periods.
There is also a slight uptick in the NPA of SME loans which will be focused and controlled in Q4. The credit for the 9 the credit cost for the 9 month FY26 remains at 50 basis points within our guided range. Profitability during the quarter net income margin grew by 26% year on year to 406 crores. Our spreads improved to 8.9% driven by decline in cost of funds to 8.3%. The provisions related to the implementation of the new Labor Code has been considered in the financials. The impact of the same is 3.85 crores and it is crores net of tax.
Our OPEX as a percentage of AEM remains stable at 2.7% for the quarter profit grew 26% year on year to 239 crores, translating to an ROA and ROE of 7.9% and 20.2% respectively, which is one of the highest in the industry. The profit for the nine months rose 26% to 685 crores. Now coming to the funding. During Q3 we raised approximately 902 crores on a consolidated basis primarily through a mix of NCDs, term loans and securitization. Our liability profile continues to remain well diversified with 59% of the borrowing from banks, 11% from NHB, 17% through NCDs including insurance companies and mutual funds, and the balance through securitization.
As part of the ongoing focus on liability diversification and prudent ALM management, we also executed a direct assignment transfer of around 165 crores during the quarter which supported our principal business criteria and further strengthened our balance sheet. We continued to maintain a strong liquidity portion with a total liquidity of 1,877 crores as of December, including 1,387 crores of undrawn bank sanctions, providing us ample headroom to support growth. Now with these remarks I open the floor to the question and answer session. Thank you.
operator
Thank you sir. Ladies and gentlemen, we will now begin the question and answer session. If you have a question, please press Star and one on your telephone keypad and wait for your turn to ask the question. If you would like to withdraw your request, you may do so by pressing Star and two again. Participants, you are requested to limit your questions to two per participant. If you have a follow up question, please rejoin the queue. Again, ladies and gentlemen, we will wait for a moment while the question queue assembles. We have the first question from the line of Kunal Shah from Citigroup.
Kunal Shah — Analyst
Yeah. Hi sir. So firstly maybe if you can quantify in terms of what has been the impact of discontinuing the smaller ticket loans maybe for in the 9 month disbursement as well as 3Q disbursements and what is the quantum of that loan as a proportion of AUM currently?
P Balaji — Managing Director
So if you look at it, if you look at the disbursements of this, less than 7 lakhs in the first, in Q1, FY25, Q2 FY25 and Q2, FY25 it was around 432 crores. And in the first quarter we had done 148 crores. After that we took a decision to stop this. Less than 7 lakhs. So which means there is a difference of 283 crores which needs to be built or added to the disbursements which we have done now. So if you. So that is the difference and that is, that is a number on the disbursements, basically.
Kunal Shah — Analyst
Okay, so on a year, on year basis that number would be 1,48 crores.
P Balaji — Managing Director
Yeah. For Q3 to 149 crores.
Kunal Shah — Analyst
Yes, 149 crores. Okay. Yes. Okay. And on AUM, what is the proportion which will eventually run down over a period? So what is the proportion of the AUM at this point in time? Exact number on 10, 11%, I think.
P Balaji — Managing Director
Yeah.
Kunal Shah — Analyst
Okay. So currently that’s almost like 10 to 11. And this will keep on running down. Yes, yes. Okay. Okay.
Mr. M Anandan — Founder
Actually just to add to what Mr. Balaji said, it was less than 7 lakhs, was about 17.5% of our letting in the beginning April 24, which progressively moved down to June. In fact it’s moved down to about 16. And then in August and September it has moved down to about 9.2%. And the impact of this discontinuous of residents have likely come to where it’s less than about 5% of disbursement, you know, projected in the fourth quarter. So in other words, progressively, you know, in the overall disbursement, the percentage of discontinued portfolio starting with 70 now it’s come down to almost 6, 7% only.
And as a percentage of loan growth, as said, it’s around 10%.
Kunal Shah — Analyst
Got it, got it.
P Balaji — Managing Director
So on disbursement the impact will be.
Kunal Shah — Analyst
There in Q4 and Q1 and then the base will be set from 2Q onwards.
P Balaji — Managing Director
Yes, in Q4 also there was some. In Q4 of FY25 there was around 163 crores of disbursement which will not be there in Q4 of this year. But that will be offset by the growth initiatives which we have taken.
Kunal Shah — Analyst
Sure. And lastly on OPEX to assets, given that you would accelerate the branch expansion now. So do we see opex percent rising from the current level of 2.7 odd percent or maybe the productivity gains could actually offset that because we have seen a huge addition in the employee base collection team has been spent and we have added salesforce as well.
P Balaji — Managing Director
This 2.7% of the assets and there has been a slight increase in the expenses. We have also doubled our expenses in it. And also the 40 branches which we have opened has also doubled. There is a cost associated with that. And because of that also even with this we have been maintaining 2.7%. And also this labor code is also there to the extent of 3.85 crore. There was a debit in the PNL. But going forward what will happen is as you rightly said, we will be opening 60, 70 branches. But still if you look at our cost of opening branches or running a branch, it is the bare minimum.
So in the sense that the basic facilities are provided and we are concentrating more on the productivity of the people. So because of that we were strong. We believe that this 2.7% may slightly go up to 2.8 but it might not be substantially very high.
Kunal Shah — Analyst
Okay, thank you sir.
operator
Thank you. We will take the next question from the line of Varun Palacharya from Kotak Securities. Please go ahead.
Varun Palacharya — Analyst
With regard to the statewide EM growth figures. So if you look at Andhra Pradesh, we see a sharp declining growth. Is this largely because of the cut in lower ticket sizes or is anything else that you’re finding riskier in the state that you.
P Balaji — Managing Director
If you look at the Andhra Pradesh, there is a growth of 23%. And so basically because it is less than 7 lakhs, loans got impacted there more. And because of that there is a growth slightly coming down there. But going forward people have been informed about our strategy at the ground level in the state of Andhra Pradesh. And in fact we have seen good amount of ATS increase in the month of December because of this. And this will continue to go in the continue in this in the fourth quarter and in the coming years in Andhra Pradesh.
Mr. M Anandan — Founder
Just to add in FY26 year to date versus the previous year in Andhra Prasad, the portfolio has grown by 23% apart from the impact of the less than 7 lakh. But the base in Andhra Pradesh also is the highest in terms of the base figure. In fact FY 25 March itself it is about 4600 crores loan book. So that is really one of the. The high base also is there in other countries. In fact the Telangana also Telangana increases about 35% where the base is slightly lower compared to Andhra Pradesh.
P Balaji — Managing Director
So in other words, about going forward.
Mr. M Anandan — Founder
I think with the impact of the less than 7 lakhs getting minimized, we should get back to our growth in entrepreneurs as well.
Varun Palacharya — Analyst
Okay, so my second question is with regard to product mix change and the impact on yield. So if you look at the mix, I think the share of LAP and small business loans has increased and home loans has kind of declined on overall book. That should have ideally aided the yields offsetting the lending rate cut whatever we’ve done. So if you can give a walk as to how much is the impact on yields due to these two factors.
P Balaji — Managing Director
I think you are talking about the pie chart which was there in the India in the presentation, correct?
Kunal Shah — Analyst
Yeah, yeah.
P Balaji — Managing Director
See basically in the earlier presentations what we did was we gave the consolidated number also based on the end use of loans. Correct. Now we have there was some confusion in the numbers as pointed out by quite a few analysts which said that since it was based on end use of loans, the numbers didn’t get added up. So we had to remove that consolidated pie chart and just give the Housing Finance and nbfe. The mix has not changed because of that.
Kunal Shah — Analyst
Okay.
P Balaji — Managing Director
So because of that there is no impact on that yield and all. So what we need to do now is if you have to compare this pie chart with the previous board presentation, just take Housing Finance, AUM and NBFC and add it and see that would be the number because at that time for consolidated pie chart, we classified the loans based on end use. What does this mean? Even for if I give a LAP loan, if the money has been used up for construction, then I would have classified it as a home loan in the consolidated pie chart.
Varun Palacharya — Analyst
Yes, I got that. I was just comparing on the standalone basis. Standalone quasi homeless is about 20%. It’s now 24 and even the share of nbsp overall AM was 26 last year. It’s now 29. So in both these aspects the high has increased but yield. So that’s.
Kunal Shah — Analyst
I.
Mr. M Anandan — Founder
Voice break.
P Balaji — Managing Director
Your voice is breaking.
Varun Palacharya — Analyst
I was just saying that the quasi home loan mix in the standalone piece itself was 20% in three QFI 25. It’s not 24.
P Balaji — Managing Director
No, no, wait. Standalone thing. It was 69 and 23 or something in the housing in the earlier. Earlier slides as well. So there is no change in the mix. Actually we can discuss this. I will have it clarified with you slightly later. Yeah, because actually there is no change. I’ll explain you okay.
Kunal Shah — Analyst
Yeah.
operator
Thank you. We have the next question from Sailsh Kinani from Centrum Broking. Please go ahead.
Sailsh Kinani — Analyst
Yeah. Good morning everyone and thanks for the opportunity. So a couple of questions from my side. So we have seen with business momentum picking up in both Odisha and Maharashtra. Could you please help us understand how. How these states are expected to contribute in terms of quantification, in terms of future growth. How critical these states are. And you have alluded to AP and Telangana in your. In your utilized wanted to move about Tamil Nadu. Because Tamil Nadu being our core state is still reporting muted performance. Any. Any color you can give it on that.
P Balaji — Managing Director
First let me address this question on Orita and Maharashtra. See we have taken some two years from FY24. We started the branches and two years we have been studying the market. We are now confident of going the book there. So with that in mind we have opened more branches in this quarter. So I think eight branches in Orissa, nine branches in Maharashtra. Earlier it was only five each. So we’ll be opening more branches as well in the coming years. And we’ll end the year with 10 branches in Orita and Maharashtra. Now if you look at the loan book in FY25, it is 54 crores.
It has gone up to 109 crores in the nine months. It is 37 crores to 109 crores. And but definitely the book is behaving very well. And also we have also identified people who are contributing to this business growth. And the branches which we have started is also performing very well. So going forward we will open more branches in these states. And as we have got confidence now and this will. I mean but still these are still new. Takes this one, not four, one, not nine crores on the 12,000 crores. So definitely it will not be a huge number that will be contributing to the growth.
But definitely the growth momentum in these two states will pick up. That is the first thing on the Maharashtra. Next thing is on the Tamil Nadu. See earlier it was around 10, 11% of growth. It has got sustained at 15% growth. Now going forward it might go up to 18%. That’s what we are looking at. As we have been telling there are One or two clusters which needs to be corrected. And once we are doing. Once we have done that, we are confident of getting back to around 17 to 18% growth in Tamil Nadu. But okay, you can say Tamil Nadu is our core stage.
But actually the contribution from Andhra Pradesh and Telangana. Andhra Pradesh and Telangana has also started contributing and they are doing good. So. And also there are many players in Tamil Nadu. So that is also restricting our growth. But definitely 18% growth is a positive.
Sailsh Kinani — Analyst
Fair enough. One more thing which we have mentioned in our ppt, addition of connectors. So can you. Can you just throw some light on that? What is the rationale of that and how we are going to proceed? Is it for new states, the strategy or the core states?
P Balaji — Managing Director
Actually this is a new concept which we are evolving. See first, I mean we have thought about it and then this will be a. This will be an additional channel to the existing channel. Our core business generation will be from the branches and from our own sales officers. This is. We are trying in one or two states. If this becomes successful, then it will be launched in a full fledged basis.
Sailsh Kinani — Analyst
This pilot has been reaching specific or anything if you can throw some light.
P Balaji — Managing Director
Not clear what is the question means.
Sailsh Kinani — Analyst
The pilot connector business model, what we are trying piloting, right. Is it specific to any region, a new geography or across. That is what I wanted to understand.
P Balaji — Managing Director
Actually we are trying this in Tamil Nadu and Andhra Pradesh. I mean it is in a very nasal stage. We have this launched it in Jan. So over and over. I mean we need to see how this performs and then we’ll be rolling out to other states.
Sailsh Kinani — Analyst
Fair enough. Sir, just one clarification. In your opening remarks you have mentioned that asset quality has some deterioration due to seasonality in holidays. So there are no other reasons as such or you would like to highlight anything on the asset quality front.
P Balaji — Managing Director
Actually speaking asset quality trend, our housing loan portfolio has been behaving very well in the third quarter. There is a slight uptick in the NPA and also slight drop in the collection efficiency in the MSME portfolio. So anyway, we have. I mean our MIS is so strong that these kind of signals come very fast. And we have already started acting on it. And in Q4 we are confident of controlling that. So that’s the. Other than that. I’m not seeing any. Any issues with asset quality.
Kunal Shah — Analyst
You.
Sailsh Kinani — Analyst
Thanks a lot, sir. That’s very helpful and best of luck, sir.
P Balaji — Managing Director
Thank you.
operator
Thank you. We have the next question of Ansh Mehta from Value Partners. Please go ahead.
Ansh Mehta — Analyst
Yeah. Hi Mr. Balaji. You know now that we’ve discontinued loan under the 7 lakh segment, can you give us your comments on credit costs going forward? So right now we are at about 50 bids. What do you expect that going forward? Your voice was not clear. But I think your question was on the future guidance. Guidance on the credit cost, right?
Kunal Shah — Analyst
Actually, yeah. We have been. We have been guiding a credit cost of 0.5% and that. We retweet that that will be maintained. I mean this is despite the aggressive right of policy which we are following. And this will be maintained. So going forward also you can factor in 0.5% credit cost in all the models which you are developing.
Ansh Mehta — Analyst
Sure. Thanks. And in terms of our expansion to newer states and Odisha, of course we are sourcing most customers through our in house metric. But is that true for newer branches as well? How do we go about sourcing more customers?
P Balaji — Managing Director
No, your voice is not very clear. Very. We are not able to hear you properly.
Ansh Mehta — Analyst
Sorry, I meant when we are entering newer markets such as Maharashtra and newer branches, how do we look at our sourcing profile?
P Balaji — Managing Director
You know, when we are entering newer states, profile is not. No, no. See, the sourcing profile has been common. But if you look at our processors, it is not the question. It will be. It will not be different if it is. If you are entering into a new state, it will be the same. The sales officers will be sourcing the profiles. And of course we have also got a digital marketing team at the head office where if the leads are coming from either the customer app or the construction ecosystem app, they get those leads. They check for.
They do an initial check on whether the customers are primarily eligible for our loans which meets our credit norms and that gets passed on to our branches for taking it forward. So this sourcing will continue whether it is a new state or whether it is a whole state. This process is going to be there in all the branches. And that is how we are doing in Orica and Maharashtra as well.
Ansh Mehta — Analyst
Got it. Okay. Thank you.
operator
Thank you. We have the next question from the line of Rajiv Mehta from. Yes, security. Please go ahead.
Rajiv Mehta — Analyst
Yes, sir. Hi, good morning. Congrats. Yeah, congrats on steady performance. So this MSME asset quality issue in which you said that brought under control in Q4. So have you already seen improvement in. Bounce rates in January and February or are we seeing similar bounces? But you’re trying to connect it earlier.
P Balaji — Managing Director
And resolve it earlier. Now the bounce rates have not. I mean there was slight increase in the bounce rate as well in the Q3 and that has not come down. But we will have this additional efforts for collecting these monies in the MSME segment. Because again if you look at it, the product is the same again. It is secured by the self occupied residential property. The LTV is 35, 40%. The installment to income ratio is currently maintained at 50%. So those kind of cushions are already available. So it is just that maybe we need to push hard our collection guys to get this done.
And that is being done. I mean we have already started observing this in December itself. We are pushing this and January, February, March definitely will be a better number for this.
Kunal Shah — Analyst
Okay, okay.
P Balaji — Managing Director
Enter this whole, you know, loan classification angle.
Kunal Shah — Analyst
I mean now if you look at, if you add up the, you know, AUM of HFC and NBFC and then you look at the loan classification of home loan, I think it’s about 48, 49% pure home loan. Yes. And you know that piece is growing at, you know, 2%, 3% on a Q on Q basis.
P Balaji — Managing Director
So when you give us a long.
Kunal Shah — Analyst
Term growth path of 20 to 24%.
P Balaji — Managing Director
Then at the current proportion of home.
Kunal Shah — Analyst
Loan, we would require the home loan fees to grow at a much faster pace. Right. From here on. Yes, yes.
P Balaji — Managing Director
That is why we have also, I mean I was talking about this optimization incremental for the incremental customers. So this is likely to bring in more, more volumes in terms of housing loans. And also what we were talking about, this customer connected channel where we are trying out that also is likely to bring in more housing loans at a much higher ticket size and better quality customers. So all this is going to aid us in getting that growth.
Kunal Shah — Analyst
And just one clarification sir, when you.
P Balaji — Managing Director
Say that we are moving towards higher.
Kunal Shah — Analyst
Ticket segments to build a better quality customer base.
P Balaji — Managing Director
So we are largely into self construction home loans.
Kunal Shah — Analyst
Right.
P Balaji — Managing Director
So when we talk about migrating ticket.
Kunal Shah — Analyst
Size, does it mean that we will target customers, you know, having larger plot size or building, you know, you know, building a larger, you know, value of homes?
P Balaji — Managing Director
Or does it just simply mean that we will go beyond 15 lakhs or 18 lakhs. See what I’m meaning by increasing ATS. Maybe if I have done 8 lakhs or 9 lakhs ATS last year, I will do 10 lakhs or 10.5 lakhs. That’s the first thing. And also the cost of construction.
Kunal Shah — Analyst
The.
P Balaji — Managing Director
Cost of construction I mean is also going up. So we need to fund the customers for that as well. Right. So that is what is moving in this higher eight years. And by in the process, we are also getting better quality customers. It is not. If I go beyond 15 lakhs and above, that will be more. I don’t think we are in that segment. Okay.
Kunal Shah — Analyst
Okay.
P Balaji — Managing Director
So we have not opened up the.
Kunal Shah — Analyst
Upper, upper end of the range. Okay.
Varun Palacharya — Analyst
Yeah.
P Balaji — Managing Director
No, no.
Kunal Shah — Analyst
Yeah. Perfect. Perfect. Thank you. Yeah.
P Balaji — Managing Director
Best of luck.
operator
Thank you. We have the next question from the line of Amit Ketan from Labimum Capital. Please go ahead.
Amit Ketan — Analyst
Hi sir. Thank you for the opportunity. Can you talk a little bit about the competitive landscape? If we look at our different products, that is home loans, lap, MSME loans, right. Where do you see the most competitive intensity and across which geographies and related to that, what are the steps we are taking to stay competitive in this space in the marketplace beyond the. You talked about the recalibrated pricing in the home loans and who are the key competitors?
P Balaji — Managing Director
Let me explain this. See if you look at it. First of all, let us understand that the market opportunity is huge. That is the first thing then. Okay. There are. There are competitions emanating from various players in certain geographies. Basically in Tamil Nadu we are seeing a heightened competition. But in other states we are not seeing that kind of a competition. That so that is one thing. And there are players like. I mean if you look at our. They have opened some nine branches in Tamil but just to establish their presence. So there are quite a few players who are operating in the Tamil Nadu segment which they believe this because the portfolio quality is good and that kind of thing.
So the competition is there in Tamil Nadu. But in other states we are not seeing that kind of acute competition. And in the case of SME there are many players, but they are into different products. So we have got a product which is between 5 and 15 lakhs and we are charging between 17 to 20%. And we are giving loans from 7 years to 10 years. So this product, not many are there. So we have ample scope of growth there as well. So that is basically the composition landscape which we are seeing as of now.
And of course in Oriza and Maharashtra where we are operating, there are not many players that are available.
Mr. M Anandan — Founder
Just to add to that point, actually, apart from the competition from the existing NBFCs including HFCs, the newer segment, newer players like small finance banks are some aggressive lending by the PSC banks. And the MSME segment also is becoming an additional source of competition. But our own experience, more than the competition we see, see, you know, more than the demand point of view, demand perspective we see particularly the competition is more Disturbing. Not, you know, it is not. It is somewhat. We are seeing at a closer quarter. Competition in terms of our HR resources at the branch level from the existing, you know, the NBFCs housing companies. So in other words, field level customer facing jobs and maybe the attrition there. Actually it’s more of a competition rather than really demand oriented competition at this point in time.
Amit Ketan — Analyst
Understood, understood. And just a follow up to that. We are not recalibrating our pricing in MSME and lab. So is it a fair assumption that competition is more in the housing segment?
P Balaji — Managing Director
That’s what I told. I mean the competition is more in the housing segment.
Amit Ketan — Analyst
Okay.
P Balaji — Managing Director
And that is why we are calibrating the interest rates on the housing loans for the incremental customers which will aid growth in the housing loans.
Amit Ketan — Analyst
Understood? Understood. Thank you.
operator
Thank you. We have the next question from the line of Avnish Tewari from Vicaria Change llp. Please go ahead.
Avnish Tewari — Analyst
Hello. Hi, can you hear me?
operator
Yes.
Avnish Tewari — Analyst
Yeah. Yes, yes. Yeah. Can you articulate this less than 7 lakh segment? What are the asset quality markers there? Either 30 plus DPD or slippage rate in Q3 versus Q2 if it is. Overlapping with the MFI. And that’s where you are seeing some stress. MFI companies are reporting improvement in their asset quality markers. So how is your experience in this pool? Let’s assemble that pool.
P Balaji — Managing Director
If you, I mean if you remember right from the first quarter of this financial year we have been talking about moving away from this less than, I mean increasing the average ticket sales and moving away from the segment less than 7 lakhs. And we have also been telling that it is not because of asset quality, we are moving away. It was that, I mean we were seeing some stress in the MFI and also the small lab segment. Because of that we took a decision proactively to get into this segment and which is actually aiding us to get better quality customers.
So it is not the stress levels. If you look at the NTA levels Of less than 7 lakhs or more than 7 lakhs, it is not different. It is basically the decision. I mean at that point in time there was some stress in the MFI and also in the small lab segment which made us take this decision. And still we believe though MFIs are reporting better numbers but their numbers have not come back to normalcy. So as of now we are still of the belief that the asset quality there has to improve. If I have to reconsider that.
So as of now we’ll still. That is the decision point. Which made us to get away from this less than 7 lakhs. So going forward also we would like to stick to this.
Avnish Tewari — Analyst
Okay, great. This MSME where you are seeing some.
P Balaji — Managing Director
Degree of delinquencies going up. Do you know on the ground what is the feedback? What exactly factors you are observing? Any segment of customers or geographies which are giving you this. Basically if you look at some of the SME loans while the end use is monitored at the time of giving the loans, most of the things, I mean many, many a time the amount gets spent on consumption maybe for a health or a marriage or something like that. But while we have checks in place to. I mean check whether the money used, money given has been used up for the purpose of the loan which we have given.
But still there will be some segment where the consumption, the money has been used up for consumption which is creating the stress. So. But actually if you look at it, their business models are intact. If you look at our customers business models, the cash flows are there. It is basically a temporary blip that has happened and which has led to this slight increase in the NPAs and also drop in collection efficiencies. And also considering the cushions we have on the LTV and also in the installment income ratio. So we are confident that we’ll be able to collect this back.
Kunal Shah — Analyst
Okay. Lastly, is there a divergence between low.
P Balaji — Managing Director
Ticket size MSME loan versus high ticket.
Kunal Shah — Analyst
Size where you are experiencing this or this is not necessarily divergent by that.
P Balaji — Managing Director
That’s what I told you. It is not that less than 7 lakhs. Greater than 7 lakhs where we are seeing this kind of an issue.
Kunal Shah — Analyst
It’s not that. Okay, great. Thank you.
operator
Thank you. We have the next question from the line of Chintan Shah from ICC Securities. Please go ahead.
Kunal Shah — Analyst
Yeah, thank you for the opportunity. Also just one question. I think on. I’m not sure if this is repetitive but on the standalone P and L, if I look at the impairment number. So that has inched up from around 4.6 crores to around 13.8 crores on a sequential basis wherein on the consolidated basis the sharp. The rise has not been that sharp. So this. I just wanted to understand how should we.
P Balaji — Managing Director
How is this? See if you look at the. I mean last quarter we reported a policy change of right of greater than 500 days. Correct. So if you look at that decision, the impact on nbsp was more there because most of the assets went into that 500 days bracket in the NBFC in the housing finance company there were some Assets which were at the brink between 400 to 450 days in the last quarter that has come to this 500 days now. So because of that this cross has gone up. So going forward we are not expecting.
It’s basically a lead lag kind of a thing where because of two companies being there and at different points in time the assets are getting into that 500 days thing. So because of that this cost difference is there going forward. We are not expecting that to happen. Overall credit cost will be at 0.5%.
Kunal Shah — Analyst
Understood. Understood. I’ve got it. Yeah. Thank you. That’s it from my credit. Thank you.
operator
Thank you. We have the next question from the line of Rohit Maheshwari from Tata. Please go ahead.
Rohit Maheshwari — Analyst
Good morning sir. So my question is on a larger. On a longer term view. Give me you have you have an aspiration by FY29 your book will be. Your EM size will be close to 250. 250 billion rupees to considering that you would. Because the disbursement growth for the Last give me 3 4/4 has been very subdued type as compared to the earlier times. So to reach that give me you would require a higher growth. Plus give me your also 10% of your book will run down maybe next 15, 18 months which is below than 7 lakh.
So when by when we can see a pickup in the in disbursement.
P Balaji — Managing Director
Basically if you look at it see that is the reason we have also given a slightly lower growth. If you look at our guidance it. Is between 22 to 24% and it. Is because of this we have moved away from the less than 7 lakhs that has slightly moderated the disruption growth in this year. And going forward also this is likely to have that impact. But of course this year only that impact will be there. And we are also tracking out various initiatives to bring back the growth that is going to be there. Like for example eight years. Like for example I was talking about the branch expansion increase in aps reduction in the home loan rates for the housing low. So these are some of the high impact initiatives which we are targeting to bring back the growth.
But having said that having guided at 22 to 24% achieving this 25,000 crores AEM by FY29 might get delayed by 1/4 or 2/4. So other than that we are not seeing that kind of a thing. But considering the current operating environment this is the correct growth I think which is good for the company. So. So this is what is the plan we have.
Rohit Maheshwari — Analyst
Yeah. Thank you sir. Thank you. I’m done.
operator
Thank you. We have the next question from the line of B. Krishna Vagarcia from Aon Investment Management. Please go ahead.
. Krishna Vagarcia — Analyst
Thank you for the opportunity. So I have two questions. First is regarding the competitive intensity in the market. So whenever we hear from, you know, small finance bank and micro finance players, all those are, you know, from last one year they are venturing into affordable housing finance. Most they find it very lucrative and all of them are venturing into those things. So I mean particularly the affordable housing finance segment. So how do you see that, you know, competitive intensity in last one year. Plus how do you see in a. You know, coming one or two year.
P Balaji — Managing Director
What is your view? Actually this was actually explained by Mr. Anandan also. See if you look at it from the. I mean we are not seeing competition more from the business angle, but more from the HR angle. The thing people get get into these new companies because of that we are seeing seeing an issue rather than because of the market size of the market opportunity. That’s the answer which I can give on the competition intensity.
. Krishna Vagarcia — Analyst
My second question is, you know, since going public we have, you know, we have consistently, you know, grown our revenue and profits and all those stuff also. We, we have, I mean on financially we are very good and you have, you know, started issuing dividend also. But all those efforts still are not, you know, resulting into shareholders return even after, you know, four or five years of ipo. So are you planning to take any actions or which, you know, which can help to generate the sharehold returns? Because the only guy who is not paid after the IPO is shareholder.
I think rest of the stakeholder are, you know, are paid that you. So do you have any action plan for that?
P Balaji — Managing Director
Actually speaking if you look at the management’s perspective, I will deliver exceptional results in the operating side. I mean operationally we will be very, very efficient and we will be able to deliver these numbers in the future as well. But if you look at the market, I don’t think I have any hold on that. I mean as long as even I have. If you look at my stock, Apple Stock, I think 17 analysts have covered and there is a 14 analyst who are recommended by. This is basically reflecting the strong fundamentals we have, strong processes we have and the efficiency to execute things.
All this is there. But if the market is believing some other thing, I don’t know how much to convince the market. I can only communicate with like this to you all. And also most of the time I am also meeting the investors. So I am also communicating the same thing to them over and above that. If the market is this way, I don’t think I can do anything about this.
. Krishna Vagarcia — Analyst
Okay, okay. Like can you increase, you know, dividends or, or you can issue, you know, buyback or anything?
P Balaji — Managing Director
Kind of. Are the board willing to do that.
P Balaji — Managing Director
Or is there any discussion in India buyback or intent? You see? Yeah, it is not available. It’s not possible. That is one reason we have also started giving dividends. But over and above that, I don’t think we can do anything about this. Yeah. Thank you.
Varun Palacharya — Analyst
Thank you.
operator
Thank you. We have the next question from the line of Mayank Mistry from Antique Stock Broking. Please go ahead.
Mayank Mistry — Analyst
Hi sir. Thanks for the opportunity. Sir, my question is largely on the spreads. So we have decreased our cost of decreased from 8.7% to 8.3% over the last four quarters. I would like to know what is. The incremental benefit that we are, you know, expecting in terms of, you know, since we got a rating upgrade in Q1 and given that some of the MCLR is also about to get through, maybe so any, any guidance on that front? That’s one. And secondly, given that we are decreasing our lower ticket size as well. So from there, what is, what is the incremental yield decline that we can expect? I mean of course, for the higher. Ticket and maybe for the better customers. You must be, you know, taking some hit on the yield. So in net, net, what might be the impact on this?
P Balaji — Managing Director
First of all, if you look, I’ll answer your query on the cost of funds. If you look at my total borrowings, 61% is variable and 39% is fixed. And of that 61%, 25% is linked to NCLR and 30, 35, 32% is linked to EBLR basically repo rate or the treasury bill. So in that 31% of that borrowing there is another 0.25% repo rate cut which will come in as savings. So from the.0 3.4% savings in interest cost that have been achieved till date, another 0.1 to 0.15% savings will come. Of course, if you look at our incremental cost of funds which we were borrowing between 8.5 to 8.6% in housing finance companies that we are borrowing at between 7.85 to 7.95 now.
And in the case of the NBSC earlier we were borrowing between 9 to 9.25. It is around 8 to 8.25 now. So this is Likely to bring in good amount of efficiency in terms of cost of borrowings. And in the case of yields, like what I have communicated earlier, it is only on the housing loans and also on the incremental customers where we have reduced the rates by 0.5 to 0.75%. If you look at the impact of the total on the total loan book, the impact is likely to be less than 10 basis points. Yeah.
Mayank Mistry — Analyst
Okay, so you got it. Thank you sir.
operator
Thank you. We have the next question from the line of Manik Bansal from Master Capital Services Ltd. Please go ahead.
Manik Bansal — Analyst
Hi sir. Thank you for taking my question. So with the quarterly disbursement running at 8% of AUM and but the reported AUM growth is 4.8% quarter on quarter. So this implies a sequential 3.8 quarterly runoff. So can management quantify the split of this?
P Balaji — Managing Director
What is the question? I can understand.
Kunal Shah — Analyst
With the quarterly disbursement running at 8.7-8% of AUM. Right. But the reported AUM growth is 4.8% sequentially this quarter. This implies a differential of 3.2% that is attributable to, you know, prepayments, repayments and btouts. So can you quantify that split between those segments?
P Balaji — Managing Director
If you look at the rundown it is around 15.9%. And of that 10% will be. Sorry 6% will be on the pre close. 6%, 6 or 7% will be because of the pre closures. And of that the balance transfer is only 2.5 to 3%. And the balance 10% is on the rundown from the principal because of the repayments from the customers.
Manik Bansal — Analyst
Okay, and last question. Strategically like what level of disbursement to AUM ratio is required to achieve the target of 25 and 25,000 cross by FY27.
P Balaji — Managing Director
So anyway we have completed this and then only we have given this number. So that is that this product makes. There is a detailed calculation that has been made and based on that only we have 50.
Manik Bansal — Analyst
Okay, thank you.
operator
Thank you. We have the next question from the line of Daksh Chaudhary from the Ratna TR Investment Management llp. Please go ahead.
Dakash — Analyst
Hello. Yeah, hi sir. So could you please guide us on what percent of housing loan AUM is linked to pmay?
P Balaji — Managing Director
Actually pma. It’s not very high because pma. Why we are more in the rural areas rather than the urban areas. The government that is pushing more on the pmay, urban, urban and semi urban. Because of that most of our customers don’t become eligible because PMA Rural is not a great success. Actually government also has been pushing on the PMAI Urban only. So our kind of customers don’t qualify so much for the PMA work.
Dakash — Analyst
Okay. Okay sir. But no definite number can be given.
P Balaji — Managing Director
It’s very minimal.
Dakash — Analyst
Okay. Thank you sir.
operator
Thank you. We have the next question from the line of Satyam Kumar from a holding trust. Please go ahead.
P Balaji — Managing Director
Hello.
Satyam kumar — Analyst
Thanks for giving me this opportunity. So I have just couple of questions from Subaji. First is like I have been following. Your guidances since last three, four quarters. So what I observed there has been multiple times bit of chop and change. Like earlier you guided in I think. Back in Q4 about 28%, 30% AUM growth. Then 25 right now around 23, 24.
P Balaji — Managing Director
On top of that you said that the targeted 25,000 crore can be delayed by one or two more quarters. So are you sure about this group? Because what happens time and again the guidance gets changed. So it brings a sentimental hit onto the table. So are you confident you are? First of all when we give a guidance it is depending on the market conditions present at that point in time. So the market conditions also change as and when we progress. See and there are certain decisions to be taken for this purpose which is good for the organization at some point in time when this kind of development happened.
For example stress in the MFI portfolio, stress in the small ticket flat 7 lakhs. So that is why we took it, took this decision. And because of that there is a moderation in the disbursements. So I mean the guidance will be given at that point in time when the market looks really good. And after that if some events are happening I need to tone down the whole thing because for me maintain, maintaining the quality of book is much more important than maintaining a guided range of 28% or 25%. So definitely this confidence with 25,000 crores by maybe with a lag of one or two quarters is possible subject to the fact that things will improve in the MFI segment, small ticket lab and the overall environment.
So that is how. I don’t think I can be sure at any point in time. Saying this is what it is correct. So the decisions for the guidance is based on the market sentiment and market conditions at that point in time. Just to follow up on this. So do you still see volatility in this overall industry or like things are more or less settling right now. So would you like to comment on overall macro environment with regards to affordable housing? Just to add, you know you are.
Mr. M Anandan — Founder
Aware that the by and large the financial services as a business as a whole depends and link to the volatility in the overall economic activity. Then the overall economic activity, the volatility because of internal within the country or external environment, the backlog level volatility is there in the overall economic system. Obviously it will have an impact on the financial services as well, which we have been seeing in the results published by various financial services companies in the last one week, two weeks kind of thing. So but within that, the challenge is really for each one of us to manage the impact of this volatility as minimum as possible.
That’s where APTUS is able to manage this volatility still maintained a consistent growth in our top revenue, overall revenue in our margin and in our roe. In our roe. And you know, just growth alone, a percentage of growth and disbursements alone. You know, we agree, absolutely we agree with you that whatever we guide, we should strive and get it and we should be willing. We will continue to do that. But then there will be these temporary situations will be there, as you are aware. But that is why APTUS is taking a lot of steps. As Mr. Balaji has rightly listed out. They are taking various steps that will really increase our resilience even better and increase our reimbursements. And the loan book growth also is better, while at the same time maintaining our quality of loan book and quality of. And also the level of margins that we are doing. So in other words, for us, while. You know, the risk also is as. Important, managing the risk of the portfolio is as critical as the growth rate percentage itself.
Dakash — Analyst
Thank you for your detailed answer, sir. And just one last question. My second question is like you have. Recently received the credit setting up rate, so are you also looking to like refinance your existing high cost loan or a fixed loan, increase the more portion of variable loans in your. In your. Sorry, variable portion of your borrowings in the. In the total borrowing mix.
P Balaji — Managing Director
So how it is like are you refinancing your borrowings? No, this is an ongoing excite which our treasury beam always does that. Suppose if it is a fixed rate loan or a variable rate loan contracted at a higher rate of say 9% or 9.25% in case of an NBFC, we always negotiate with the bank call them because they also have to give us additional funding. And because of that, and considering the reasons, we always negotiate hard with them to reduce the interest rate for which we are successful in the sense that there are three or four loans, even SBI rate which was around 9.25% that has got reduced to 8.4% and there is also a new facility that has been given by them of 7.95%.
So overall it’s an ongoing process by our treasury team where these kind of negotiations keep on happening and the rates are getting reduced.
Satyam kumar — Analyst
Thank you sir.
P Balaji — Managing Director
Thank you.
Satyam kumar — Analyst
Thank you for detailed answer.
operator
Thank you very much Ladies and gentlemen, that was the last question for today. I would now like to hand the conference back to the management for the closing comments.
Mr. M Anandan — Founder
Thank you everyone for attending the conference call. I would like to pay my sincere gratitude to all analysts and taken time out to listen to us today. Please feel free to contact us if you have any further queries. Thank you.
operator
Thank you very much. Thank you all for being a part of the conference call. If you need further information or clarification, Please email investor relationsaptusindia.com Ladies and gentlemen, this concludes your conference for today. Thank you for using Chorus Call Conferencing Services. You may now disconnect your lines. Thank you and have a pleasant day everyone.