{"id":133716,"date":"2022-09-02T09:12:02","date_gmt":"2022-09-02T13:12:02","guid":{"rendered":"https:\/\/44.250.171.167\/?p=133716"},"modified":"2023-04-25T08:33:02","modified_gmt":"2023-04-25T12:33:02","slug":"dominance-of-aavas-financiers-limited","status":"publish","type":"post","link":"https:\/\/alphastreet.com\/india\/dominance-of-aavas-financiers-limited\/","title":{"rendered":"Dominance of Aavas Financiers Limited"},"content":{"rendered":"\n<p><a href=\"https:\/\/www.aavas.in\/\" target=\"_blank\" rel=\"noreferrer noopener\">Aavas Financiers<\/a> is an affordable housing finance company. The firm has a diversified browning profile along with a robust asset liability management position. The company also enjoys a capital adequacy ratio (CAR) of more than 50%. The company has very diligently ensured that the average maturity of the debt is in sync with the lifecycle of its assets while also ensuring that its balance sheet is devoid of any sort of short term debt. The lender has plentiful sources to raise additional liquidity from various sources to ensure their stability.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>The rationale behind Aavas\u2019s success comes down to three crucial factors:<\/strong><\/h3>\n\n\n\n<h4 class=\"wp-block-heading\"><strong>Firm\u2019s capacity to borrow at favourable rates: <\/strong><\/h4>\n\n\n\n<p>The firm\u2019s cost of funds stands at around 7% which relatively is far better than its rivals in the segment by around 20 to 100 basis points. The reason behind this is due to the firm\u2019s long standing proven record of possessing a high quality asset portfolio with a superior product portfolio along with robust capital adequacy. The Indian financing market saw a huge crash due to firms relying on the short term borrowing to purchase long term assets which turned out to be their downfall. However, Aaavas relies on the long term borrowings and staves aways from short term borrowing to finance its activities. Another factor that works in favour of the firm is that its loan book, which is dominated by retail home loans, falls unders the Priority Sector Lending category (PSL). This puts Aaavas in an advantage because Aavas has positioned itself as a high quality PSL investment for banks that in turn allows Aavas to transfer its loans and risk to the banks. Additionally, Aavas has gained interest from DFIs like Asian Development Bank etc which helped Aavas raise close to \u20b9 500 crores. Furthermore, credit rating agencies have rated borrowings to Aavas at AA- which is a testament to its strong loan book.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\"><strong>Concentrating on Specialised Consumer Segments: <\/strong><\/h4>\n\n\n\n<p>Aavas has carved a niche of its own. Affordable Housing Financing segment is the firm\u2019s area of focus and expertise. Rather than focusing on Tier 1 cities, Aavas has concentrated its efforts in Rural India. Along with that, lenders usually spread themselves too thin by expanding geographically too wide &#8211; too fast, instead Aavas tries to go deeper into existing geographical bases before entering new regions. The firm\u2019s strategy is to focus on self employed income segments on self constructed propertings, this particular niche is very difficult for banks to penetrate since it requires a deeper form of verification and it bypasses the large developer financing deals as well.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\"><strong>Aavas enjoys a higher pricing power: <\/strong><\/h4>\n\n\n\n<p>The customer base for Aavas have limited access to credit as their income levels are lower than \u20b9 50,000 a month on average. Thus, Aavas transaction comes with a monthly instalment of \u20b9 12,000 to 15,000 per month for a 15 year housing deal. Since, the monthly instalments remain steady, Aavas enjoys a steady and stable balance sheet which is difficult for lenders to snatch away even though the customer base is largely non delinquent.\u00a0\u00a0\u00a0<\/p>\n\n\n\n<p>Therefore, the deep expertise Aavas has garnered in its segment and the unique business model it has created is difficult to replicate.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Aavas Financiers is an affordable housing finance company. The firm has a diversified browning profile along with a robust asset liability management position. The company also enjoys a capital adequacy ratio (CAR) of more than 50%. The company has very diligently ensured that the average maturity of the debt is in sync with the lifecycle [&hellip;]<\/p>\n","protected":false},"author":1885,"featured_media":133717,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[1941,1,6352,6350],"tags":[10371,10097,10370],"class_list":["post-133716","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-stock-analysis","category-finance-stocks","category-research-summary","category-trending-stocks","tag-ahfc","tag-financial-service","tag-housing-finance"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"https:\/\/alphastreet.com\/india\/wp-content\/uploads\/2022\/09\/iStock-185096621.jpg","jetpack_likes_enabled":false,"jetpack-related-posts":[{"id":144931,"url":"https:\/\/alphastreet.com\/india\/earnings-aavas-financiers-limited-nse-aavas-q4fy23-results-out-total-income-rises-23-yoy\/","url_meta":{"origin":133716,"position":0},"title":"Earnings | AAVAS Financiers Limited (NSE: AAVAS): Q4FY23 Results Out; Total Income rises 23% YoY.","author":"Divyansh_Kasana","date":"May 3, 2023","format":false,"excerpt":"AAVAS Financiers Limited (formerly known as \"Au Housing Finance Limited\") is a leading housing finance company based in India. The company primarily caters to the low and middle-income segment of customers in semi-urban and rural areas by providing housing loans. AAVAS Financiers Limited has a strong presence in Rajasthan, Gujarat,\u2026","rel":"","context":"In &quot;Earnings&quot;","block_context":{"text":"Earnings","link":"https:\/\/alphastreet.com\/india\/category\/earnings\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/alphastreet.com\/india\/wp-content\/uploads\/2023\/05\/4b0b185d-fd09-4e7e-947d-ef141089055f-15.png?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/alphastreet.com\/india\/wp-content\/uploads\/2023\/05\/4b0b185d-fd09-4e7e-947d-ef141089055f-15.png?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/alphastreet.com\/india\/wp-content\/uploads\/2023\/05\/4b0b185d-fd09-4e7e-947d-ef141089055f-15.png?resize=525%2C300&ssl=1 1.5x, https:\/\/i0.wp.com\/alphastreet.com\/india\/wp-content\/uploads\/2023\/05\/4b0b185d-fd09-4e7e-947d-ef141089055f-15.png?resize=700%2C400&ssl=1 2x, https:\/\/i0.wp.com\/alphastreet.com\/india\/wp-content\/uploads\/2023\/05\/4b0b185d-fd09-4e7e-947d-ef141089055f-15.png?resize=1050%2C600&ssl=1 3x, https:\/\/i0.wp.com\/alphastreet.com\/india\/wp-content\/uploads\/2023\/05\/4b0b185d-fd09-4e7e-947d-ef141089055f-15.png?resize=1400%2C800&ssl=1 4x"},"classes":[]},{"id":159021,"url":"https:\/\/alphastreet.com\/india\/aavas-financiers-ltd-q3fy24-9-rise-in-profits\/","url_meta":{"origin":133716,"position":1},"title":"AAVAS Financiers Ltd Q3FY24; 9% rise in Profits","author":"Divyansh_Kasana","date":"February 21, 2024","format":false,"excerpt":"Incorporated in 2011, Aavas Financiers Ltd provides housing loans & advances Financial Results: AAVAS Financiers Ltd reported Revenues for Q3FY24 of \u20b9508.00 Crores up from \u20b9411.00 Crore year on year, a rise of 23.6%. Total Expenses for Q3FY24 of \u20b9360.00 Crores up from \u20b9274.00 Crores year on year, a rise\u2026","rel":"","context":"In &quot;AlphaGraphs&quot;","block_context":{"text":"AlphaGraphs","link":"https:\/\/alphastreet.com\/india\/category\/infographics\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/alphastreet.com\/india\/wp-content\/uploads\/2024\/02\/image-169.png?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/alphastreet.com\/india\/wp-content\/uploads\/2024\/02\/image-169.png?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/alphastreet.com\/india\/wp-content\/uploads\/2024\/02\/image-169.png?resize=525%2C300&ssl=1 1.5x, https:\/\/i0.wp.com\/alphastreet.com\/india\/wp-content\/uploads\/2024\/02\/image-169.png?resize=700%2C400&ssl=1 2x, https:\/\/i0.wp.com\/alphastreet.com\/india\/wp-content\/uploads\/2024\/02\/image-169.png?resize=1050%2C600&ssl=1 3x, https:\/\/i0.wp.com\/alphastreet.com\/india\/wp-content\/uploads\/2024\/02\/image-169.png?resize=1400%2C800&ssl=1 4x"},"classes":[]},{"id":165731,"url":"https:\/\/alphastreet.com\/india\/aavas-financiers-ltd-q2fy25-43-fall-in-profits\/","url_meta":{"origin":133716,"position":2},"title":"AAVAS Financiers Ltd Q2FY25; 43% fall in Profits","author":"Divyansh_Kasana","date":"November 20, 2024","format":false,"excerpt":"Incorporated in 2011, Aavas Financiers Ltd provides housing loans & advances Financial Results: AAVAS Financiers Ltd reported Revenues for Q2FY25 of \u20b91,628.00 Crores up from \u20b9497.00 Crore year on year, a rise of 11.97%. Total Expenses for Q2FY25 of \u20b91,601.00 Crores up from \u20b91,372.00 Crores year on year, a rise\u2026","rel":"","context":"In &quot;AlphaGraphs&quot;","block_context":{"text":"AlphaGraphs","link":"https:\/\/alphastreet.com\/india\/category\/infographics\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/alphastreet.com\/india\/wp-content\/uploads\/2024\/11\/GF.png?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/alphastreet.com\/india\/wp-content\/uploads\/2024\/11\/GF.png?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/alphastreet.com\/india\/wp-content\/uploads\/2024\/11\/GF.png?resize=525%2C300&ssl=1 1.5x, https:\/\/i0.wp.com\/alphastreet.com\/india\/wp-content\/uploads\/2024\/11\/GF.png?resize=700%2C400&ssl=1 2x, https:\/\/i0.wp.com\/alphastreet.com\/india\/wp-content\/uploads\/2024\/11\/GF.png?resize=1050%2C600&ssl=1 3x, https:\/\/i0.wp.com\/alphastreet.com\/india\/wp-content\/uploads\/2024\/11\/GF.png?resize=1400%2C800&ssl=1 4x"},"classes":[]},{"id":166947,"url":"https:\/\/alphastreet.com\/india\/aavas-financiers-ltd-q3fy25-63-fall-in-profits\/","url_meta":{"origin":133716,"position":3},"title":"AAVAS Financiers Ltd Q3FY25; 63% fall in Profits","author":"Divyansh_Kasana","date":"February 18, 2025","format":false,"excerpt":"Incorporated in 2011, Aavas Financiers Ltd provides housing loans & advances Financial Results: AAVAS Financiers Ltd reported Revenues for Q3FY25 of \u20b91,840.00 Crores up from \u20b9508.00 Crore year on year, a rise of 6.24%. Total Expenses for Q3FY25 of \u20b91,805.00 Crores up from \u20b91,624.00 Crores year on year, a rise\u2026","rel":"","context":"In &quot;AlphaGraphs&quot;","block_context":{"text":"AlphaGraphs","link":"https:\/\/alphastreet.com\/india\/category\/infographics\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/alphastreet.com\/india\/wp-content\/uploads\/2025\/02\/U-11.png?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/alphastreet.com\/india\/wp-content\/uploads\/2025\/02\/U-11.png?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/alphastreet.com\/india\/wp-content\/uploads\/2025\/02\/U-11.png?resize=525%2C300&ssl=1 1.5x, https:\/\/i0.wp.com\/alphastreet.com\/india\/wp-content\/uploads\/2025\/02\/U-11.png?resize=700%2C400&ssl=1 2x, https:\/\/i0.wp.com\/alphastreet.com\/india\/wp-content\/uploads\/2025\/02\/U-11.png?resize=1050%2C600&ssl=1 3x, https:\/\/i0.wp.com\/alphastreet.com\/india\/wp-content\/uploads\/2025\/02\/U-11.png?resize=1400%2C800&ssl=1 4x"},"classes":[]},{"id":168156,"url":"https:\/\/alphastreet.com\/india\/aavas-financiers-ltd-q4fy25-6-fall-in-profits\/","url_meta":{"origin":133716,"position":4},"title":"AAVAS Financiers Ltd Q4FY25; 6% fall in Profits","author":"Divyansh_Kasana","date":"April 30, 2025","format":false,"excerpt":"Incorporated in 2011, Aavas Financiers Ltd provides housing loans & advances Financial Results: AAVAS Financiers Ltd reported Revenues for Q4FY25 of \u20b91,909.00 Crores up from \u20b91,861.00 Crore year on year, a rise of 2.58%. Total Expenses for Q4FY25 of \u20b91,698.00 Crores up from \u20b91,625.00 Crores year on year, a rise\u2026","rel":"","context":"In &quot;AlphaGraphs&quot;","block_context":{"text":"AlphaGraphs","link":"https:\/\/alphastreet.com\/india\/category\/infographics\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/alphastreet.com\/india\/wp-content\/uploads\/2025\/04\/J-5.png?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/alphastreet.com\/india\/wp-content\/uploads\/2025\/04\/J-5.png?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/alphastreet.com\/india\/wp-content\/uploads\/2025\/04\/J-5.png?resize=525%2C300&ssl=1 1.5x, https:\/\/i0.wp.com\/alphastreet.com\/india\/wp-content\/uploads\/2025\/04\/J-5.png?resize=700%2C400&ssl=1 2x, https:\/\/i0.wp.com\/alphastreet.com\/india\/wp-content\/uploads\/2025\/04\/J-5.png?resize=1050%2C600&ssl=1 3x, https:\/\/i0.wp.com\/alphastreet.com\/india\/wp-content\/uploads\/2025\/04\/J-5.png?resize=1400%2C800&ssl=1 4x"},"classes":[]},{"id":160592,"url":"https:\/\/alphastreet.com\/india\/aavas-financiers-ltd-q4fy24-13-rise-in-profits\/","url_meta":{"origin":133716,"position":5},"title":"AAVAS Financiers Ltd Q4FY24; 13% rise in Profits","author":"Divyansh_Kasana","date":"April 26, 2024","format":false,"excerpt":"Incorporated in 2011, Aavas Financiers Ltd provides housing loans & advances Financial Results: AAVAS Financiers Ltd reported Revenues for Q4FY24 of \u20b9546.00 Crores up from \u20b9450.00 Crore year on year, a rise of 21.33%. Total Expenses for Q4FY24 of \u20b9370.00 Crores up from \u20b9292.00 Crores year on year, a rise\u2026","rel":"","context":"In &quot;AlphaGraphs&quot;","block_context":{"text":"AlphaGraphs","link":"https:\/\/alphastreet.com\/india\/category\/infographics\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/alphastreet.com\/india\/wp-content\/uploads\/2024\/04\/image-60.png?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/alphastreet.com\/india\/wp-content\/uploads\/2024\/04\/image-60.png?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/alphastreet.com\/india\/wp-content\/uploads\/2024\/04\/image-60.png?resize=525%2C300&ssl=1 1.5x, https:\/\/i0.wp.com\/alphastreet.com\/india\/wp-content\/uploads\/2024\/04\/image-60.png?resize=700%2C400&ssl=1 2x, https:\/\/i0.wp.com\/alphastreet.com\/india\/wp-content\/uploads\/2024\/04\/image-60.png?resize=1050%2C600&ssl=1 3x, https:\/\/i0.wp.com\/alphastreet.com\/india\/wp-content\/uploads\/2024\/04\/image-60.png?resize=1400%2C800&ssl=1 4x"},"classes":[]}],"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/alphastreet.com\/india\/wp-json\/wp\/v2\/posts\/133716","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/alphastreet.com\/india\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/alphastreet.com\/india\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/alphastreet.com\/india\/wp-json\/wp\/v2\/users\/1885"}],"replies":[{"embeddable":true,"href":"https:\/\/alphastreet.com\/india\/wp-json\/wp\/v2\/comments?post=133716"}],"version-history":[{"count":0,"href":"https:\/\/alphastreet.com\/india\/wp-json\/wp\/v2\/posts\/133716\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/alphastreet.com\/india\/wp-json\/wp\/v2\/media\/133717"}],"wp:attachment":[{"href":"https:\/\/alphastreet.com\/india\/wp-json\/wp\/v2\/media?parent=133716"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/alphastreet.com\/india\/wp-json\/wp\/v2\/categories?post=133716"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/alphastreet.com\/india\/wp-json\/wp\/v2\/tags?post=133716"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}