Aavas Financiers share price surges 9% on heavy volumes, hits 5-month high

Aavas Financiers share price: Assets under Management (AUM) of the company grew by 20% year-on-year and stood at Rs 19,238 crore as on December 31, 2024

Aavas Financiers share price hit an over five-month high of Rs 1,845 per share on the BSE today, as it rallied 9 per cent in Monday's intraday trade, amid heavy volumes. The stock of the housing finance company was trading at its highest level since October 1, 2024. It had hit a 52-week high of Rs 1,978.25 on June 19, 2024.

 

At 10:28 AM, Aavas Financiers share was quoting 7 per cent higher at Rs 1,825 as compared to 0.31 per cent rise in the BSE Sensex. As many as 2.01 million equity shares of the company have, collectively, changed hands on the NSE and BSE thus far in the session.

 

Thus far in calendar year 2025, the stock of the housing finance company has outperformed the market by gaining 10 per cent as against a 5 per cent decline in the benchmark index.

 

Aavas Financiers is a retail affordable housing finance company, primarily serving low- and middle-income self-employed customers in the semi-urban and rural areas in India. The company's product offering consists of home loans for the purchase or construction of residential properties, and for the extension and repair of existing housing units, Loan Against Property, and MSME loans.

 

Aavas Financiers said the launch of Pradhan Mantri Awas Yojana (PMAY) 2.0 scheme, including the interest subsidy scheme for urban housing, will be pivotal in improving loan accessibility for economically weaker sections and low-income groups, empowering countless individuals to realise their dreams of homeownership. This bold initiative reflects the Government's steady commitment to ensuring that every Indian has access to safe and affordable housing, driving inclusive growth and prosperity for all.

 

Meanwhile, Assets under Management (AUM) of the company grew by 20 per cent year-on-year (Y-o-Y) and stood at Rs 19,238 crore as on December 31, 2024 (Q3FY25). Disbursements during Q3FY25 grew by 17 per cent Y-o-Y and 23 per cent sequentially to Rs 1,594 crore. Further, in the April to December 2024 period (9MFY25), disbursement grew by 11 per cent Y-o-Y to Rs 4,099 crore.

 

The management remains confident of achieving desired AUM growth with around 25 per cent disbursements growth. In addition, the entry into Southern markets is expected to boost the growth. The company is also comfortable on growing MSME segment, where yields are ~15 per cent.

 

Spreads improved to 4.94 per cent in Q3FY25 from 4.89 per cent in Q2FY25. The management expects disbursement yield to surpass AUM yield in FY26. The 1+dpd has improved to 3.85 per cent in Q3FY25 vs 3.97 per cent in Q3FY25, and is seen falling further in Q4FY25. This will aid the overall asset quality of the company.

 

Analysts at IDBI Capital expect disbursement growth to remain strong, aided by lower TAT (6 days vs 13 days) and tapping the newer markets. In addition, strong asset quality is expected to support profitability, the brokerage firm had said.

 

Meanwhile, on August 10, 2024, the promoter/ promoter group of Aavas Financiers, i.e. Kedaara Capital and Partners Group, had entered into Share Purchase Agreements (SPA) to sell their entire stake in Aavas Financiers to Aquilo House Pte. Ltd., belonging to CVC Capital Partners group. Aquilo House Pte. Ltd has also announced an open offer to public shareholders of AFL, in compliance with Sebi regulations.

 

Post the consummation of the SPA and completion of the open offer, the Acquirer shall be categorised into promoters/ promoters group of Aavas Financiers while Kedaara Capital and Partners Group will cease to be promoters / members of the promoter group of AFL. The aforesaid transaction is subject to various regulatory and lenders approval.