Aavas Financiers hits 52-week high; surges 7% in 2 days on healthy outlook

SBI Mutual Fund, under its various schemes, has disposed net sale of 7.54 million shares representing 9.53 per cent of the equity capital of Aavas Financiers via offer for sale.

Aavas Financiers share price hit a 52-week high of Rs 1,994.45, gaining 4 per cent on the National Stock Exchange (NSE) in Thursday’s intra-day trade on a healthy outlook. In the past two trading days, the stock of the housing finance company has rallied 7 per cent. It surpassed its previous high of Rs 1,978.25 on June 19, 2024. The stock had hit a record high of Rs 3,336.95 on February 2, 2022.

 

On Wednesday, March 19, 2025, Aavas Financiers informed that SBI Mutual Fund has reduced its stake in the company to 0.056 per cent from 9.587 per cent, as the mutual fund tendered its shares in open offer.

 

 

SBI Mutual Fund, under its various schemes, has disposed of 7.544 million shares via offer for sale and acquired 58 shares (net sale of 7.544 million shares) representing 9.53 per cent of the equity capital of Aavas Financiers. The final holding of SBI Mutual Fund, under its various schemes, as at the close of business hours on March 18, 2025, was 44,129 shares, which is 0.055 per cent of the total equity capital of the company, Aavas Financiers said.

 

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.

 

Meanwhile, last week, on March 12, based on rating assessment undertaken by CARE Ratings, the rating agency reaffirmed the ratings assigned to the various instruments and bank facilities of Aavas Financiers with a stable outlook.

 

Aavas Financiers’ funding position remains adequate due to strong relationship, with all the leading banks of the country such as Punjab National Bank (PNB), State Bank of India (SBI), HDFC Bank, and funding support from various international agencies, such as Asian Development Bank (ADB), International Finance Corporation (IFC), and British International Investment (Erstwhile known as CDC).

 

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.

 

Meanwhile, in the past two months, the stock price of Aavas Financiers has outperformed the market by surging 20 per cent as the company’s Assets under Management (AUM) 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.

 

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.

 

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.

 

The management remains confident of achieving the 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 regarding the growing MSME segment, where yields are ~15 per cent.

 

“We have completed upgradation of all major tech platforms which are now stabilising; this was one of the fastest tech implementations in the industry. We believe we have set the foundation for sustainable, scalable and profitable growth,” the management said in Q3FY25 earnings conference call.