Thank you, Nirav. Good evening, everyone.

This is Viral Shah from IIFL Capital. Welcome to the 3Q FY26 earnings conference call of Bajaj Housing Finance Limited.

On behalf of IIFL Capital, I would like to thank the management of Bajaj Housing Finance for giving us this opportunity to host the call. From the management team today, we have Mr.

Atul Jain, Managing Director; Mr. Gaurav Kalani, Chief Financial Officer; and other senior members of the management team.

We will have opening comments from the management team, post which we will open the floor for Q&A. With that, I would like to transfer the call to Atul for his opening remarks.

Over to you, sir.

Thank you, Viral, and IIFL team for hosting today's concall. Good evening to all the participants.

Investor deck for Q3 has been uploaded on our company's website under the Investor section and also on both the stock exchanges. I hope you had a chance to go through the same.

Me and my colleagues here are here to first take you past the important features of the deck, and then subsequently to answer any questions you have on the deck. I'll quickly cover important panels of the investor deck.

First, I'll start with panel number three. Overall a good quarter for AUM and profitability.

AUM stood at ₹1.33 lakh crore, growing 23% on YoY basis due to continued good momentum in disbursements during the quarter, which were partially offset by higher attrition. PAT grew 21% with annualized ROA of 2.3% and ROE of 12.3%.

Asset quality remained healthy during the quarter with GNPA at 27 bps, NNPA at 11 bps, and annualized credit cost of 19 bps. Operating efficiency as well improved during the quarter, leading to opex to NTI at 19%.

This 19% is excluding one-time exception item against 19.8% in same quarter last year. Company's geographical coverage stood at 221 branches across 178 locations.

The company also continues to have comfortable capital adequacy with CRAR at 23.15%, and PBC for the company, which is a regulatory criteria, stood at 61.37% from a threshold of 60% as per regulation. I'll move to the next panel.

I've talked about overall AUM growth. Overall AUM addition was ₹6,664 crore in Q3 FY26 compared to ₹5,745 crore in Q3 FY25.

AUM growth at product level was: home loans grew 18%, LAP 32%, LRD by 39%, and developer financing by 18%. Portfolio composition continues to remain well-diversified with home loan mix at 54.5%, LAP at 10.7%, LRD at sub-22%, and DF at 11.6%.

Disbursements during the quarter reflected good momentum with growth of 32% on YoY basis from ₹12,571 crore in Q3 FY25 to ₹16,545 crore in the quarter gone by. I'm moving to the next panel, which is panel number five.

Cost of funds improved by 50 bps on YoY basis from 7.9% in Q3 FY25 to 7.3% in Q3 FY26. On sequential basis, COF moderated by 5 bps due to policy rate transmission on existing borrowings and also impact of incremental borrowings at lower rate.

Borrowing mix continue to remain well-diversified with higher composition of money market instruments. Borrowing composition was 52% from money market, 39% from banks, and 9% from NHB refinance.

Gross spreads overall moderated by 12 bps sequentially from 1.9% in Q2 FY26 to 1.8% in Q3. This was due to portfolio yield reduction of 17 bps, which got partially offset by 5 bps benefit in COF.

Now, spreads for Q3 Q2 FY26 had expanded to 1.9% from 1.8% in Q1 FY26 and Q4 FY25. You will recollect during last quarter we had called out that the margins have expanded due to delayed transmission in part of the portfolio while the cost of funds benefit was upfronted.

In that sense, Q3 became as a normalized at a spread of 1.8%, which was in line with the previous two quarters before Q2. However, from a YoY basis, this was lower.

Net interest margin held at 4% in Q3 FY26 while remaining flat on sequential as well as on YoY basis. Opex to NTI, which was covered in initial panel, improved to 19%.

Exceptional item was of ₹13.1 crore due to one-time impact of gratuity provisions pursuant to implementation of labor codes. I'll move to panel number six.

Healthy asset quality during the quarter with GNPA at 27 bps in Q3 against 26 bps in Q2. NNPA improvement of 1 bps on sequential basis to 12 bps from 12 bps to 11 bps.

Credit cost annualized was 19 bps during the quarter compared to 15 bps in Q3 FY25. However, in Q3 FY25, we had a one-time overlay release of ₹10 crore.

Factoring that, the credit cost would have been 20 bps in last year, 19 bps versus 20 bps last year. Quarterly PAT has grown 21% from ₹548 crore to ₹665 crore.

Annualized ROA stood at 2.3% against 2.4% last year same quarter, but in line with sequential 2.3% in the previous quarter. ROE at 12.3% compared to 11.5% in Q3 FY25.

Overall net worth of the company was a bit tad below ₹22,000 crore at ₹21,838 crore as of 31st December '25. I'll now straight jump to panel number 19, which is both a quarterly snapshot as well as a nine-monthly nine months YTD snapshot.

Majority of the quarterly metrics have already been covered on the previous panels. NII for Q3 FY26 has grown by 19% to ₹963 crore while NTI has grown 24% on YoY basis.

This is due to higher assignment income and fees and commission income. Both PBT and PAT has grown by 21%.

On a nine-monthly basis, net total income has grew by 24%, operating expenses increased by 20%, and PPOP, pre-provision operating profit, has grown by 24%. Overall, PAT has grown 20% for nine months FY26.

Opex to NTI on a year-to-year basis up to YTD basis has moderated by 50 bps to 19.9% from 20.4% in nine months FY25. Credit cost is 18 bps in nine months FY26 against 8 bps in nine months FY25 because of a overlay release of ₹60 crore in nine months of last year.

Adjusted for that, it is largely flat. ROA was 2.3% and ROE was 12% in nine months FY26.

I'll move to panel number 21. As discussed earlier, portfolio yield dropped by 17 bps on sequential basis from 9.3% to 9.1% while cost of funds saw sequential benefit of 5 bps to 7.3%.

Thereby, gross spread has contracted by 12 bps to 1.8%, but similar to Q1 and also Q4 of last year level. Opex to NTI has dropped by 80 bps to 19.8%.

NIM flat at 4% on YoY as well as sequential. Asset quality trend and portfolio metrics have already been discussed on previous panels.

I'll move to next panel. Well-diversified borrowing mix, this is enabled through borrowing relationship with 18 banks and highest possible credit rating of AAA Stable.

In terms of sequential movement in borrowing mix, bank borrowing mix has increased by 2.8% while NCD mix has moderated by 70 bps, CP mix has come down by 1.6%, and NHB refinance by 40 bps. Moving to panel number 25.

Portfolio mix remains well-diversified basis our guided range. On sequential movement, LRD and LAP share has increased by 40 bps each while moderation in home loan share by 60 bps and construction finance by 20 bps.

I'll move to next panel. Now, this is a panel we are introducing for the first time.

This is an additional panel because of this is giving an update on our SBU which we set up around 1.5 year back for Sambhav Loans, which for near-prime and affordable to expand both customer segment for the company as well as enhanced yields for the company. Now, currently this business, on close to 16 18 months of an operation, has reached a level of a monthly disbursal run rate of a ₹325 to ₹350-odd crore.

As a company, we are targeting ₹600 crore plus monthly disbursement run rate in next 12 to 15 months through strategic investments being made in this SBU. Sambhav Loan has two parts.

Now, because when what we call as a Sambhav Loans in SBU has two parts: one is a near-prime, second is an affordable. Under near-prime business, we target average ticket size of ₹40 to ₹60 lakh, having yield in corridor of 9% to 11% with focus on top 36 markets.

For affordable, we target average ticket size of ₹15 to ₹35 lakh with yield ranging between 11% to 13% and operating in deeper geographies of top 36 market, that is the outskirts of the main cities, as well as Tier 4 and rural location. In terms of a geographical coverage, now this business is now operating from 73 urban locations and 72 Tier 4 stroke rural location.

Under Sambhav Loans, we offer loans for all transactions in home loan, which is whether purchase, resale, self-construction, and balance transfer. We have also deploying dedicated teams for separate type of channels in this business, which is intermediary sourcing is B2C team, at a developer counters we are deploying B2B teams, dedicated D2 teams, as well as the direct-to-consumer teams and the loan against property team.

We'll move to the panel number 31. Stage 1 assets have moderated by 3 bps on sequential basis to 99.36% in Q3 while Stage 2 assets has correspondingly increased by 3 bps to 37 bps while both of them are at same levels as of last year.

Now, GNPA has inched up by 1 bps to 27 bps from 26 of last quarter, but NNPA has improved by 1 bps. Overall, the asset quality remained same.

Provisioning coverage ratio remains healthy at 58.76%. I'll now move to panel number 33, which is the last panel I would like to cover.

Provisioning coverage ratio remained healthy and was higher than 50% across product lines. Home loans GNPA inched up by 2 bps on sequential basis to 34 bps.

LAP GNPA improved by 7 bps to 52 bps while DF GNPA was flat as of Q3 FY26. Overall NPA improvement by 1 bps, including flat NPA in home loans while LAP NNPA has improved by 5 bps to 24 bps.

That's all from my side on quarter updates. Happy to take questions now between me and the management team.

Over to you, Viral.

Hi Atul. Hi Gaurav.

Thanks for taking my questions. A few quick ones.

One is Tier 1. Why has it declined so sharply?

Even if I add back the profits, it would be about 70-80 bps. The drop at about 3% QoQ is very sharp.

Can you talk about that? Basically this quarter's Tier 1 drop, that's point number one.

Point number two, when you're giving this medium-term outlook on cost to income, what is the timeframe? Because even if I assume something like three years, the opex growth will work out to around 9% if the revenue growth is somewhere around 20%.

That looks quite low or is that possible given all the AI intervention, etc., that you are doing? That's question number two.

Question number three is if you can share the BT in and BT out in home loans for the quarter, that would be very useful. Thanks.

I think those were my questions.

Thanks, Abhishek. Your question, first part of the question, Tier 1 decline, that is in so if in November, there had been a consolidation of applicable guidelines by Reserve Bank of India when they came out with a consolidated circular.

There has been a minor change which we are seeing in that guidelines as they consolidated the guidelines because there was an illustration given for under-construction home loans and the developer loans in the erstwhile guidelines, which allowed the provisioning for undisbursed tranches of home loan or undisbursed tranches of a construction finance for provision of capital only up to the next stage of disbursement. Now, while of a consolidation of the guidelines, this example has been removed.

Now, on a conservative basis, then we have provided capital for the entire chunk of undisbursed loans in both home loans as well as the construction finance loans rather than only up to the next tranche available till we have a much more clarity. That is where you have seen the sharper drop in the Tier 1 for provisioning of entire undisbursed tranches of home loan and a construction finance loans in the current quarter.

That's where the drop in the CR Tier 1 you are seeing. Cost to income ratio timeframe is Yeah.

I just ask a clarification? When will this clarification come from the regulator?

Because this means that all the incremental disbursements or sign disbursements that you do, even in that or the undisbursed part the sanctions that you do, the undisbursed part will still attract a capital charge. Will this mean faster capital consumption?

Yeah. This will be But at the point of a time, because this is only applicable on the under-construction home loans, we have a reasonable size there.

As the volume grow, the build up of the undisbursed portions will be lower because the older portions keep on getting disbursed. To the point what you are making, till the point of a time there is a regulatory clarity or the provision, we have to provide for that because the illustration was the basis for providing till the next tranche.

With illustration gone, you have to provide for as the guidelines stand as it is. We have to factor in as a conservative basis and factor in all the entire capital.

We'll hope for the regulatory clarity or a question at an early date. Pending that, we will continue to provide for entire capital on all new loans also being disbursed.

Understood. The second part of the question was cost to income ratio.

The timeframe we take a 3 to 4 year to 14% to 15%. Now, Viral, opex growth can be a bit higher because as we will continue to invest we what we call in the Sambhav Loans next 2 years, 3 years, we will continue to invest in our Sambhav Loan unit much more.

Even in fact, we will accelerate our investments next year in the Sambhav Loans to gain scale much more rapidly in the near-prime and the affordable space. Now, if you look at a year-on-year, it has dropped from 20.75% to 19%, almost a drop of 1.75% over the last 4-5 quarters on a quarter-on-quarter basis by at an absolute basis.

When you see that this is despite the currently declining interest rate scenario which compresses the margin. We remain very our path what we have charted out that 15%-16% 14% to 15% would be feasible to deliver in next 3 to 4 years timeframe without any extra there.

The path of growth and the path of movement what we are doing will be sufficient for us to reach that level. On a BT in and BT out, I'll request Gaurav to give.

Yeah. This is the BT out, this is the BT in.

Our BT in for the last quarter was 16.5% of our total home loan acquisition. BT out on the portfolio is 16.9%.

BT out is close to 20%. BT out, Gaurav is informing me it's close to 20%.

BT in is 16.5% of our total home loan acquisition for the last quarter. Compared to industry level, BT, would you have that number also?

At a normal basis, in BT in industry used to be 15% of the total home loan disbursement. We are in line with that.

However, my own personal assessment is that has gone up in last two quarters specifically because the kind of a But that's a impression or a what you can say assessment we have. Now, this is a data whatever the published data previously we'll have on the composition of the home loan industry, it used to be 15% used to be BTs.

My own suspicion is last two, three quarters it is much more elevated because of a rate cut pressure from a public sector banks. It's my own assessment of the market.

Okay. Quick data point, Sambhav loans, what is the AUM?

AUM is close to now ₹5,900-odd crore. Or ₹5,000 ₹5,000 ₹5,000 crore plus odd.

Both near-prime and affordable put together?

Yeah. Okay.

Got it. Thank you, and I'll come back in the queue for more.

Thank you very much.

Hi Atul. Hi Gaurav.

Thanks for the opportunity. Just want to understand what is our prepayment rate which would include the BT out, plus there would be foreclosures, there'd be people who want top-ups, and there'd be people who'd be fighting for rates.

If we can split this into these four broad categories. The second is how many people do we bank on a monthly basis, as in the NACH hitting their bank accounts on a monthly basis?

The third question is around liabilities today. What of our borrowings are on floating, and what do we think about the cost of funds going forward in the next year?

Thanks.

Hi Shubhranshu. On the prepayment rate, total cumulatively what I called out last in the last question is 20%.

Now, this is a mix of a part payment being done by the customer or the natural attrition what happens and also the BT out. While largely you can take 60%-70% of it as a BT, and balance be the natural attrition what customer does, offer 20% kind of a run rate 20% run rate.

So, 14% to 15% you can take as a BT, and 5% 4%-5% would be the natural attrition plus the part payment. On the banking numbers, I'll check and come back to you by the time because exact number my mix is close to I think 3 300,000-odd customer would be there, but I'll just validate that.

On the fixed and the floating mix, if you look at an AUM, we are at a 60% floating. On a AR, floating will be 52.

When we look at the liabilities, we look at a AUM because there is a balance sheet which is there which is assigned out. Floating is 60% at AUM, around 52% on AR basis.

Just one clarification on this BT out. If there are 100 applications with say that, okay, I want to transfer my file, how many are we able to retain back?

Roughly 40% of the applications eventually move out in 90 days period. Okay.

This versus the industry in the same ticket sizes in prime segment would be how much? There is no industry data which gets published on this basis on the ticket size and the on attrition basis, retention or attrition basis.

I'll not be able to comment on whether it is high or low. Given that we are in the prime segment, I'll suspect our attrition rates would be higher than the industry.

Our banking numbers are 3.3 lakh just now we confirmed. I said approximately 300,000, it's 3.3 lakh.

What do we think of cost of funds in '27? It's a very difficult question if you're asking today because Q4 is a very difficult.

Vijay is here from a Treasury. Vijay, any?

So, 25 to 30 bps kind of a downward revision we are looking at for a full-year level is a assessment as of today. Given whatever has happened in last 30-35 days in the market and especially in the money market side where the money prices have gone up, but we assume that is till March, from April things should get back to normal.

Sorry, you're saying 25 bps of cost of funds will reduce despite the G-Sec yields hardening? No, I am saying that the G-Sec yield hardening we are taking it as a till March phenomenon because of the liquidity crunch in the market.

From April, we expect the market to be normalized because basis today, if you look at a money market today, then we are not talking about any savings there. Our reasonable estimate is the next year there should be a 20-25 bps kind of there because there is a repricing of the existing borrowings also because there is a existing borrowings maturity which were done slightly at a higher rate which will get replaced even if the markets don't come back to a very low level.

There is some gain which will come from the level what you are currently borrowing, because the incremental borrowings are cheaper than the cost of funds at a book level what we have even in the current scenario as well. That's what we'll give a savings as we go forward.

Understood. Thank you so much.

I'll come back in the queue. Best of luck.

Good evening, sir.

can you speak a bit clearly near the mic?

Yeah. Is it better now?

It's better.

Yeah.

Just two questions. First, if you could just comment a little bit on the competitive intensity.

Now, why I ask this is this quarter at least based on the commentaries that we have heard till now, everyone is talking about significantly elevated competitive intensity, primarily from banks within banks, PSUs. Now, I understand we've been talking about this competitive intensity for the last couple of quarters, but just trying to understand, has it got much more pronounced in the last maybe 2-3 months?

Within that, is the competition only pronounced in the prime and super-prime segments, or are you also starting to see this competitive intensity go up in the near-prime and affordable segments? That is my first question.

The second one is around the PLR changes that you've done. If you could just help us understand that last quarter in the month of January what PLR changes have we done, and how are we thinking about any further PLR changes over the next two months of this quarter?

Lastly, this quarter we've done slightly higher disbursements. How are we thinking about it?

Is there a annual disbursement volume that we work with or is it more opportunistic based on you using it as a liability tool? Whenever opportunities arise, you go ahead and do the assignments.

Just those three questions.

Thanks, Abhijit. Abhijit, first on the competitive intensity, we have called out during last quarter as well, we feel the competitive intensity is a feature, not a novelty in the market.

That is what I stated in Q1 and Q2 as well. There will be the pressure on the prime side and the super-prime because that is our major part of our business will always be high is what we work with a base case assumption.

It remains as pronounced as it was, and we believe it is likely to remain like that. Our plan factor in a high level of a competitive intensity continuing because there will be at a point of a time there will be some banks who will be very aggressive, at a point of a time there will be other banks still very aggressive.

Largely competitive intensity from the banks on the pricing side remains on the prime and super-prime side. On the near-prime or affordable side, it is not the pricing intensity, but the number of players presence and the number of players wanting to make more space there which is increasing, but pricing intensity is not seen as a competitive manifestation there.

On the PLR change, there are two various parts of our books. One is a book which is an external benchmark linked.

There it is passed on in line with the benchmark, which is close to 10%-12% of our book is linked to repo rate. There the book is passed on, the repo rate benefits are passed on as per the external benchmark.

On the non-repo rate linked book, which is our salaried book in the prime side, what we have passed on till now from a rate cut cycle from March is 60 bps. January, I'm not clear of January.

February onward, ever since the rate cut cycle, in line with each rate cut, like this last rate cut which had happened, we have passed on in December. January there is no other further rate cut.

So, 60 bps of a pass-through has happened. We don't see as of now any further pass-through in next 60 days whether downward or upward basis the market conditions as of now.

That is, of course, subject to I'm assuming there is no rate cut coming in the upcoming MPC. Right.

Sir, just one follow-up based on the first question, the Tier 1 that you explained, right, why the decline. I was just trying to understand if my understanding is right.

Now what we've done is on the sanctioned amounts as well, we have taken a capital charge and till better clarity comes. The problem here is until now, right, as an industry, we never used to provide on the sanctioned amounts, right?

While you said that over a course of time those sanctions will convert into disbursements, but until the time clarity emerges, people will shy away from giving higher sanctions, right, because that eventually means that even without disbursing, you are having to take a capital charge. No, this is not linked to that, Abhijit.

This is not sanctioned amount because sanctioned amount in any case you have to factor in some as a part of a credit conversion factor in your disbursements, and that's only for a temporary period of a 30-60 days, which in any case keeps on going on a rotating basis. This is on a under-construction home loan or under-construction project finance, you have disbursed one tranche because you have to disburse first tranche, but the money keeps on going over a period of 24-36 months in tranches which are linked to the construction.

You have to sanction the full amount, you have to disburse the first tranche because that's how you will disburse the final money. There is no escape from not sanctioning, because you're disbursing, then you're providing for

it. Got it.

This is useful. Thank you so much, and I wish you and your team the very best.

Hi. Thanks for taking my question.

Most of my questions have already been answered. I just have one from my end.

Can you please share how your NIMs will trend going forward, and what will be the impact on margins assuming that long-term yields will remain elevated?

Hi, Chirayu. For the current year, we have already guided for NIM movements and NTI movements, etc.

For the year, while we had said that we'll be able to maintain the NIIs in line with last year, NTI at a overall level, we are looking at around 15 basis points to 20 basis points of drop there for the entire year. That's what we had guided at the start of the year.

Okay. Thanks a lot.

Thank you. Atul, I had two questions.

One is do you have any, say, targets with regards to how big the near-prime and the affordable segment could be, say, maybe three years down the line? Secondly, even this ₹325-₹350 crore of monthly origination that we are doing in this business, can you let us know what percentage of this is, say, a fresh origination versus, say, a BT in?

Who would be the typical competitors for us in the market?

Viral, target for near-prime and affordable can be as large as it is there because like we said that last year when we started this, we said that as we go forward, as we get more confident on the credit performance of the portfolio, we'll continue to expand our offerings here as well as the appetite here. Today what we're looking at is in next one or two years to take the business multiple from where it is there.

12 months, we have already said that next 12 months to 15 months, we will be looking to nearly double the kind of a disbursement run rate. Thereon, it is a business which is evolving.

Space is large, reasonably large. We'll continue to evolve.

Next three years, we see ourselves having a significant amount of investments continuing in this business, which is near-prime and affordable for us to keep on growing. So, 36 months from here, it will be in investment phase, you can assume that we'll be looking to grow the business significantly aggressively over next two to three years.

On what you asked for a BT mix in this, the BT is close to 27% to 30-odd percent in the acquisition what is there. Rest is the purchase or resale or a plot plus construction, P+C, which is an affordable, which is a typical there, P+C, builder, or a resale.

BT in is 27% to 30-odd percent. Atul, the competitors, if you can give some sense over here?

From where we are getting this BT? The business will get BT even it can get a BT from a bank as well.

There is no particular personal which is targeted because it depends upon the customer need what is getting met. The customer can be looking for a top-up which was a loan was earlier.

Largely if you're looking to see that are the BT in customers coming more from affordable? No, that is not the case.

It is a mix of affordable HFCs to even banks to prime companies as well where a customer can be coming in for a See, the yield is between 9% to 11%, that's what we are calling out, and the yield in some cases can be even So, yield is not that dramatically different for a customer to be only coming from a deep down the line from affordable segment. It's a mix of a segment.

Got it. Thank you.

Hi. Good evening and thanks for the opportunity.

I think you've partly answered my question, but I'll still go ahead. You mentioned that you'll be scaling up the affordable home loans where ticket size is ₹15 to ₹35 lakh.

I think you're also saying that you're targeting some ₹600 crore of disbursements over the next 12 to 18 months. My first question is what percentage of this ₹600 crore target will come from the ₹15 to ₹35 lakh segment?

As of today, from what we do it in near-prime, if my numbers are correct, Gaurav, just check. I think 35%-40% comes at a aggregate level between ₹15 to ₹35 lakh.

I'll have to come back to you for the exact numbers because my assessment is close to ₹125-₹130-odd crore comes in that segment and balance comes from the higher than 35, which is our near-prime segment. 35.

Gaurav is confirming. He said ₹125 to ₹130 from ₹15 to ₹35.

35% of a ₹350-odd crore monthly number comes from affordable segment, balance comes from the near-prime segment.

Okay. Then your sourcing strategy in this.

I think you partly answered that 27% to 30% comes from BT in, which is where you're acquiring from the other affordable HFCs. Rest is on your own sourcing team?

Yeah. For even for balance transfer, you have to have your own sourcing team because customer will not walk in.

It's a mix of a strategy between balance transfer and the market-facing. We have four types of sourcing teams what we are deploying or what we have deployed at a subscale, but There is a internal data team, data and digital lead processing team where the larger business composition is towards the balance transfer.

There is a market intermediary focused team. There is a builder counter sourcing team because there is a fresh purchase also of a sub-₹40 lakh, sub-₹45 lakh ticket sizes which is getting done.

That is where it is sourcing. Then we're also deployed a dedicated LAP team for this segment as well.

There are four dedicated teams which have been deployed to procure this business. The BT is a mix of a business which comes in largely through the direct channel, somewhat also through a market intermediary facing.

Understood. This 35% which is affordable, will this increase or should we assume that this will remain as it is at 35%-40% of the ₹600 crore disbursement that you're targeting?

In the short run, the percentage should remain the same. As we go further forward from here, the percentage should increase.

I'll say short run means next 6 to 12 months, you should assume the percentage remaining the similar what we're talking about. As we go forward from there, the percentage would increase towards affordable because that is what as per our plan for next three years, that's what we're planning for.

Understood. Any guidance as to what percentage this can increase to from 35%, maybe 50% or higher?

Is that? That we will

evolve. Next 12 months, 15 months, we have answered.

We will evolve. It will depend upon how do we experience the customer.

See, we are first time putting up this guidance or the update on the SBU which we settled around 18 months back, because 18 months back we started. Because we at that time also said that as we gain experience, as we get more comfortable, we'll be able to take much more clearer stance and informed.

Today, 18 months down the line, we are much more confident. That's why we are taking up view for next 12 to 15 months and a bigger longer-term view.

The mix will continue to evolve basis the market opportunities as well as our experience as well as what we want to do. I'll resist from giving a guidance too far forward.

That's why next 12 months, 15 months of a mix guidance is there. Rest, we remain available to encash any opportunity available in the market.

It is there. We are not guided by a particular mix.

Fair enough. My last question.

Based on your assessment so far for the affordable housing finance segment, I'm not sure if you've done these calculations, but what percentage of your targeted locations overlap with areas where affordable HFCs are already operating? Is that something that you would have done?

Markets will be common only, Raghav. There is no differential in the market.

The catchment areas of affordable housing will remain same for whether for any other HFC or for us. They are not going to differ significantly that much and differ only if we go to, let us say, multiyear down the line.

We are going very, very deep geo, then it is there. For as of now, for us next 2-3 years, we'll remain largely wherever most of the companies are there.

We are not

No, maybe if you were to go district-wise, maybe there would be districts where you don't have as many number of affordable HFCs, and some districts where the market is either oversupplied or fairly well-supplied. I was just trying to understand some flavor on that, but yeah, I get it.

You have to assume first next one or two year, it will be largely the markets where most of the players are available, because that's how whoever started there, top 36 markets outskirts are where all the companies are there, which from where the major part of this volume is coming in. That's likely to be there for next one or two year as Like I said that, by maybe by next year then when we give a fresh flavor for a one year down the line, two year down the line, we can give more flavor.

As of now, you should assume as the same number, same markets.

Okay. That's a very clear answer.

Thanks a lot, Atul. Thank you.

Good evening to the team. I have two questions.

My first question to Mr. Jain is as housing finance market remains competitive, how does the management think about balancing growth opportunities with underwriting discipline across four products like home loans and LAP?

What changes in borrower behavior or portfolio performance would prompt you to become more selective or adjust the growth priority? Any color on how you make these decisions internally?

Just want to understand that. That's my first question.

I'll ask my second question after this. Thank you.

Thanks Sukrit. If I have understood your question, you are asking on how do we balance risk-return equation across products.

That is the I think the spirit behind the question what you are asking. See, we run an active management strategy, active risk management strategy.

The products what we do are Now, all products have their different role. Within home loan as well, the prime has a different role and a near-prime or a non-prime has a different role, then affordable has a different role.

It is matched by the opportunity, risk emanating from it, costs associated with it, and the returns. Now, at a point of a time, as the management what we look at is we are a low-risk At a broad level, our strategic construct is we are a low-risk company, which is what is reflected in our risk performance over the years as well in the portfolio.

Our anchor product remains always a low risk, which is a prime housing as well as a lease rental discounting. There we always take there we believe the kind of portfolio what we acquire is a above pristine or at a pristine level portfolio, which helps us to maintain our overall risk performance of the company.

At a point of a time, if a product is a risk challenge or a return challenge, I'm bringing in a you were asking a question from the risk challenge point of view, I'm bringing in a aspect of even a return challenge, there can be a relative weight which shifts from one product line to another product line. At there is no conversation which will as a management we will do saying that a risk is risk threshold breach is acceptable in a product.

There is a risk threshold for each product construct, and each product has a particular role in the overall company construct as a percentage as a as a percentage of percentage of the company AUM so that overall at a aggregate level, we can deliver a lower risk and a medium return company what we stand for. It was a theoretical question, and I think I have given a theoretical answer, but I hope you would have No, no, it's a very good answer.

My second question to Mr. Kalani is along the similar lines only.

Beyond the reported asset quality and capital metrics, what are the key early indicators you track internally, such as customer repayment patterns, portfolio assessment, or funding behavior that help you asset credit risk and balance sheet health ahead of what shows up on the numbers? Just want to understand a view on this, how you handle this particular thing.

Yeah. Sukrit, predominantly we look at a few metrics internally like bounce rates, how are they moving, stage-wise asset movement, how is it happening, etc.

That's why we also publish some of them in the presentation. If you look at the Stage 2, which is the early indicator, the first indicator would be the bounce rate, second indicator would be Stage 2, and then getting into the Stage 3 side.

Stage 2, if you look at, has pretty much remained in that 35 to 40 bps corridor. That gives us that comfort that overall across the couple of years, recency-wise also, we are pretty much okay on the asset quality side.

Thank you, and best of luck for the next quarter. Repayment rates

we have discussed already, Sukrit. Repayment rates over the last one, one and a half years have remained high.

This year specifically have remained elevated, not just for us, at a industry level, home loans overall if you see. Whatever results have come this quarter also, if you see 18% to 20% is the repayment rate across the industry which you would see.

For us also, it's there in that corridor around 20% rate. We have been sensing it over the last three quarters and have already factored that in while we gave our guidance in the Q1 along with the Q1 results.

Thank you, and best of luck for the next quarter.

Thanks, Sukrit.

Thanks.

Hi. Thank you for the opportunity.

Sir, with respect to the split that you mentioned for the disbursement, 35% odd, is that the same that will translate to the AUM, I believe you mentioned approximately ₹5,000-odd crore?

The disbursement growth of 32%, will it translate similarly on the AUM side? Both are different denominators, Omkar, because balance sheet denominator is different and the disbursement denominator is different.

Then there's a factor of attrition also which comes. It would not be in sync.

It would be different whether disbursement basis different and AUM growth. That's why 32% disbursement growth you are seeing 23% AUM growth.

Going forward also, there will not be or may not be a correlation on both the numbers. Not growth.

The split. So, 35% of the ₹350 crore is affordable.

Is that split also applicable on the AUM? How much of the AUM of the ₹5,000 crore?

Between near-prime and affordable, the disbursement would by and large translate into the same split in the AUM growth because it's a newer portfolio.

Understood. Understood.

Understood. Because it's relatively new, I think you barely would have any specific data with respect to any credit cost in this particular book or asset quality movements.

Overall what you are seeing, say, one year, two year down the line, because I think generally in this kind of a book, you see, first delinquencies coming after 24 months or down that line. How do you see in that perspective?

How is the count of growth, the volume of growth in your prime, super-prime, near-prime, affordable, all these four verticals?

Omkar, first question what you asked on the delinquency metrics, yes, while the delinquency comes later, but the early indicators which start becoming visible, which is a bounce rate metric, the first loan what we would have booked will be 18 months or 18 MOB old. We are reasonably confident on seeing the performance.

That's what we had called out last year that we first see the early performance because we were new in this business, and then basis that, we'll take a decision to scale. Now, when we are giving an update in the current quarter when we've taken a decision to scale it much more rapidly, we feel that is an indicator saying that our early reading of all the early metrics is giving us a comfort to rapidly expand this portfolio.

The second question I could not understand fully.

Can you? What was the approximate volume growth?

Because looking at some of the results in the space, some were cautious on the volume growth, some were optimistic on the volume growth in the specific segments. Some of the affordable housing companies were good saying they were good.

Some of the near-prime, they were saying that it's neutral. Your view on the volume growth in each of the segments: the near-prime, affordable, super-prime, prime, that way.

How is that currently and where do you see moving in the, say, 12 to 18 months? Because even the housing price is indexed at that can be seen on the NHB site.

They prices are moving up. How do you look at the volume growth in each of these segments?

Like we've called out, near-prime and affordable, we are looking to close to double the run rate in next 12 to 15 months. In both the segments, and if the mix will remain 35%-65% only between affordable and near-prime, very clearly you can deduce from there saying that we are highly optimistic of volume growth in near-prime and affordable segments as we grow from 12 to 15 months from here.

That's based on because we are newer in this segment and we are in an investment mode phase. That's what gives us a confidence, and basis our because our size is comparatively lower in the market.

As far as a prime segment or a super-prime segment is concerned, to a certain extent, it is linked to the market disbursements growth as well. We have been growing our business there, our structures have become we have kept on making more inroads in these segments over last one, one and a half years as we got new home loan leadership team on board, which is led by Jasminder for us for last 18 months back.

We remain very confident of our continuing volume growth there as well while the volume growth there in the prime and super-prime segments will to a certain extent be linked with the market growth as well. Because there we are not a upstart.

We are present in a reasonable level in the market, especially in the top six markets. Their volume growth will be driven more by non-top six markets as well as in the top six markets somewhat linked to the market growth.

Net-net, in all the four segments, for the short period which is next 12 to 18 months, we remain positively positive and optimistic on the volume growth in all the segments, whether prime, super-prime, affordable, or near-prime.

Just one data-keeping question. On the ratios, in this Sambhav Housing SBU, what are the sanction ratios and or the disbursement ratios?

Like if 100 cases come to you, how much would go to sanction and how much would go to disbursement, like a waterfall in the 18 months that you have seen?

At a broad level, 55% to 60% would get sanctioned, and out of that, Pawan, 70% would get? 70%-75% would get disbursed.

70 Out of 55%-60% would get But it will vary between various segments. Near-prime can be very different, near-prime salaried can be very different.

At a broad level, 55%-60% would get sanctioned out of 100 cases which are logged in the system, and 70%-75% would get disbursed out of the approved cases.

The sample size currently is low, so that was great. On the rate, yields, affordable you're saying it's 11 to 13.

Is this on the lower end or do you think that you can push this higher? Because some of the affordable HFCs that are listed, they are at the upper end of this scale that you're saying.

Do we think that we'll be using our benefits in the cost and trying to gain market share via undercutting them or this is just a indicative bracket?

Omkar, the affordable is a very wide market. It starts from a 9%-10%, goes up to 16%-17%.

When you see a blended rate of a other listed player, if you see a 13% rate, it will be a mix of a business starting from 10% going up to 16%-17%. Now, there are various segmentations within the affordable.

Since we are new in affordable, we have started the business not very long back, we are right now towards the upper end of the affordable segment, which is in the segment we operate in, this is a rate what is operated by most of the companies. There is no price positioning to gain market share because in affordable there's a formal segment which is at a better price range.

We are more present in the formal segment rather than the informal segment. Segment-wise the price varies.

In the same segment, we are more or less in line with all the other affordable players.

Understood. Understood.

We don't operate in technically more down the line or a more different type of a collateral assessment because we are yet learning the ropes. At this point of a time, for next 12 to 15 months, we'll like to concentrate only on the upper end of the affordable segment.

Maybe 12, 15, 18 months down the line, we'll try to explore the No, fair enough, because I felt that the yield bracket was on the lower side, maybe we were doing this consciously to scale the book or it was something else.

We have positioned ourselves towards the formal side rather than the informal segment. That's why the yield is

Understood. Understood.

Thank you.

Hi. Most of the questions are answered.

Just want to check a couple of things. Firstly, when you look at it in terms of the other income, is it primarily from the assigned loans or is there something else, maybe ₹90-odd crore in Q3 and almost like ₹133 crore for the nine months?

Is this because the off-book AUM is also going up during the quarter,

yeah? So, ₹90 crore for the quarter is largely driven by the income on derecognized loans versus a Q3 FY25, which was lower.

However, for nine months comparison, it is almost the same levels of FY25 to '26 because there's a timing differential. Last year, I think Quarter 1 and Quarter 2 were heavier on the assignment.

This year, Quarter 3 was heavier on assignment. On a year-on-year basis, the assignment income remains almost same, but on a quarter-on-quarter basis, you are seeing a much more uptick in the current year in Q3.

In terms of the guidance what you had suggested that there would be pressure on margins because of the lower reliance on assignment during this particular fiscal, because I think there is a large chunk which is gained during this quarter, do we expect that to continue even in the fourth quarter and the impact on margins may not be so high?

There are two parts, Kunal, why we do assignment. One is a ALM match, which is where the assignment is there.

However, we had called out in the Q1 saying that we're not driven by ALM match, but we like to do a lower assignment for the year to leverage the capital position more. However, we had also called out because if there is an opportunity to grow more in the non-home loan segment to maintain our PBC criteria, we will not cap the business in the non-home loan, but then assign out.

For Quarter 3, we had to assign out or we followed the strategy of assigning non-home loans more because the home loan growth as you're seeing from an AUM was 18%, driven by much more higher attritions. At overall part, we are going at 23%.

Then we would have been in a problem in the PBC criteria. That's why we assigned more in the Quarter 3.

For Quarter 4, depending upon the home loan growth versus a non-home loan growth opportunity, that will determine the assignment out strategy, whether we do a less or a more will be more driven by home loan AUM growth versus a non-home loan AUM growth factor.

Got it. When we look at NTI for first nine months compared to last year's first nine months, my calculation suggests that it's down by hardly like 6-odd basis points, and we are still guiding for maybe NIMs expected to moderate by 15 to 20-odd basis points.

What exactly is the number? If you can just highlight nine months NIM compared or maybe the NTI which you indicate in the guidance to FY25 number then nine months FY25 number.

Yeah. You're right, Kunal.

As of now, we're trending in 4% corridor over the last eight quarters. 3.95% to 4% in that corridor.

While we had guided for full year 15-20 basis points, looking at the first two months two quarters we had done lesser assignments considering how we see the attrition happening, and accordingly, we saw first two quarters at 24% growth. This quarter, we done we did relatively higher assignment than what we had done in the initial two quarters.

From here, looking at full year, I believe 8 to 10 basis points of compression would still happen on the NTI level for the full year. I'm talking of FY25 versus FY26.

It would be 8 to 10 versus the guidance which was there of 15 to 20 which has been indicated.

Correct.

Okay. We have not revised that actually in the assessment for FY26, yeah.

No, because we'll have to see how attrition plays out and also the acquisition. The attrition pressure continues, and accordingly, as we see the disbursement growth happening and the AUM growth, accordingly we'll plan for assignment in the fourth quarter.

Got it. Got it.

I would say maybe home loans as a category would anyway which ways be growing relatively slower compared to that of LRD, LAP, and the other segments. Maybe the reliance on assignment will still continue to be high given this kind of scenario of active competition.

Or maybe you are seeing anything in particular in terms of the sanctions which is giving you the confidence that maybe still that assignment could continue to be low?

Yeah. Kunal, we are hoping for that our home loan teams will disburse far more than what they're disbursing, they'll grow much faster.

That's what we are hoping for. We're ready for a Plan B, which is if our non-home loan businesses continue to grow at the pace which Then you will assign,

yeah. Yeah.

Got it. That helps, yeah.

Thank you.

Hello. On slide 17, you have your medium-term growth as 24% to 26% and your FY26 as 21% to 23%.

What's going to change over the medium term, you think, given that the level of competitive intensity is expected to be high?

Hi Bobby. We had called out clearly when we gave a guidance for 21%-23% for the current year versus the medium-term growth guidance.

The medium-term growth guidance had two factors: one, at that point of a time, the basis the disbursements we were growing and the attrition which was there, and our own strategy to keep on gaining market share in home loan. The medium-term guidance stand because that's what we believe we can deliver in the longer run or a medium run.

That is also dependent upon that what we said that 12% to 14% kind of an industry growth. Now, 21% to 23% we guided lower for the current year because after the rate cut cycle started and specifically towards nearer to June, we saw a significant uptick in the attrition pressure, which was led by largely balance transfers out to banks.

Our assessment is as the interest rate cycle gets normalized, which we had earlier estimated to get normalized by December of Jan of this year because we were not factoring in another cut in November which came, as the interest rate cycles gets stabilized, the attrition pressure will go down, and if we continue to maintain our disbursement growth, which is subject to industry continuing to grow 12% to 14%, which is the only delta factor what we have in our assessment, we believe we can go back to the medium-term guidance what we have given. That's the mathematics behind the medium term to the current year.

Medium term is what, 10 years or 5 years?

Medium term we take 3 to 4 years, 4 years.

3 to 4 years.

3 to 4 years. Okay.

You said that competitive intensity was a feature of the industry, not really something that just happens for one year. Despite that, you think you can grow at this rate?

Yeah. When I say the feature of the market, yes, competitive pressure in terms of a pricing is a feature of the market, but the attrition pressure with time when the rate stabilizes See, there is a one is the acquisition, which is a feature acquisition pricing competitiveness, which is a feature of the market, which is what we factor in will always remain.

However, the second factor, which is in a declining interest rate scenario, which the same factor multiplies by triggering much more attrition. As the interest rate stabilizes, the second factor of a much higher attrition goes off while the acquisition remains the feature.

It's not a novelty, it remains the feature. That's how as the interest rate stabilizes or maybe at a point of a time when they start going up, the attrition pressure comes down significantly while for acquisition pressure remains same.

Right now today we are experiencing both sides: acquisition pressure in the front end because of a pricing being a feature, not a novelty, but along with the declining interest rate scenario, it is triggering a much higher attrition pressure on the book.

I understand. What percent of your loans did you disburse through a direct assignment this quarter?

We assign out after acquisition. We don't do any co-lending in that sense.

We don't disburse in co-lending. No, no.

Not co-lending, but you directly sold the loans, right, rather than wait for the loans to mature?

Yeah. Assignment is done post-acquisition, which is largely our non-home loan.

Total of ₹3,000 ₹3,470-odd crore loans got assigned out during the quarter.

Oh, yeah. What percent is that approximately?

Of a total balance sheet, this will be close to 2.5% total balance sheet is close to 2.5% of ₹133,000 crore, ₹3,500 crore would be 2.6% of the total balance sheet.

That's helpful. All right.

Thank you very much.

Hi, thanks for the opportunity again. Two questions.

I think there have been a couple of promotions within Bajaj Housing. Can you please introduce the broader team of new business heads now?

Second is how does the Sambhav distribution team or the sourcing team look like, how many front-end guys, how many credit guys, how many collection guys, if you can spell out that architecture. Great, thanks.

Shubhranshu, there is no new change which has happened in the organization. The organization, the way it is structured, if you refer our presentation which is put up as a part of the investor deck, the company broadly operates in the three verticals.

One is a prime vertical. Prime vertical is headed by Jasminder, as I called out and he was introduced in earlier calls as well.

He used to be with ICICI Mortgages for a long period of time. He leads our entire prime vertical, whether home loan or LAP.

The entire supporting structure, enabling structure of the prime team is work with him to deliver the outcome what is the volume. His role is volume, scale, and low risk.

That's what he is delivering for the company. Near-prime and affordable is a second vertical for the company, which is what we started as a SBU 18 months back.

Pawan, Mr. Pawan Bhansali, he leads that vertical.

He has been leading that vertical ever since we've started setting up this vertical. Again, the enabling functions work with him to deliver this.

Third vertical of the company is commercial, which is headed by Vipin, Vipin Arora, who leads the commercial vertical, which incorporates both Vipin and Dushyant Poddar, who heads our construction finance business, lead as a overall commercial vertical lease rental discounting and construction finance. There are three verticals of the company at a business level.

There is no recent change in the company. I am not sure what you're referring for.

The second question on Sambhav loans, how does that If you're referring to some LinkedIn there, that's a part of a normal career progression after a time. There is somebody who gets upgraded or up there, but no role change or no material role change.

We keep on reorganizing our business. Recently we reorganized our direct business entirely under one umbrella.

There is no org design change which has happened in the recent past, Shubhranshu. The second part of the question was on terms of a number of people differently in the front end and in the back end.

Collections as of today, because you asked for the DMS also in near-prime, collections we run a horizontal structure, which is our DMS at a company level structure, barring commercial because commercial runs as a relationship level. Other than that, for front end?

For sales team for Sambhav is around 600-odd employees are there.

Plus direct.

Almost close to 900-odd people. That is on front end, direct including there is 900, and then followed by credit and operations team, which is again 150-odd people are there, and collection as we said, right now it is

horizontal. Understood.

Thank you so much.

Thank you for the follow-up. Just one statistic: what was the individual housing loan percentage of the total portfolio?

IHL as per definition of NHB were 50.7%, right? 50.71%.

50.71% as of 31st of December.

60? 6-0?

5-0,

50.71. 50.71%.

Okay, 50.71. I see.

Okay. Thank you, that's it.

Thank you, Atul, Gaurav, and Bajaj Housing team. Atul, do you want to make any closing comments?

No, no, Viral. Thanks.

We only wish to extend our thanks to all the participants for listening to us for so long.

Thank you.