SRG Housing Finance Ltd Q1 FY27 Earnings Analysis

- The company aims to double its AUM from INR 1042 crores to around INR 2000-2500 crores within the next 2.5 to 3 years. - Long-term vision includes expanding the loan book to INR 10,000 to 20,000 crores. - Disbursements target INR 600 crores for the current financial year, supporting AUM growth to approximately INR 1400-1500 crores. - Expansion into newer states like Maharashtra, Tamil Nadu, Andhra Pradesh, Karnataka, and Telangana with 10-15 new branches planned. - Growth driven by increased branches, operational efficiency, technology integration, and underwriting discipline. - Profit after tax has shown a 33-50% year-on-year growth recently, reflecting strong revenue growth. - Cost of borrowing expected to decline marginally, supporting margin stability. - Continued strong demand in the underserved rural and semi-urban affordable housing finance segment fuels growth potential.

- SRG Housing Finance aims to double its AUM from INR 1,042 crores in FY26 to approximately INR 2,000-2,500 crores within the next 2.5 to 3 years. - Long-term vision includes scaling the AUM to between INR 10,000 crores and INR 20,000 crores in the coming years. - Profit after tax showed a strong 33% YoY growth in FY26, indicating healthy earnings momentum. - Operational efficiencies and scale are expected to improve, with AUM per branch and employee increasing, supporting overall profitability. - NIMs are maintained around 11%, with stable cost of borrowing expected to marginally improve. - ROE is targeted around 18% in the coming years, up from approximately 12-13% currently. - Growth supported by geographic expansion, technology integration, and strong collection infrastructure. - Equity raise likely within next 1-2 years to support scaling beyond 5-6x leverage.

- SRG Housing Finance is currently focusing on expanding its branch network, especially in southern states like Maharashtra, Andhra Pradesh, Karnataka, Tamil Nadu, and Telangana, targeting 10-15 new branches in these states by the end of the year. - There is significant investment in technology, including continuous development of their own ERP system and integration of AI to improve operational efficiency and reduce turnaround time; these IT initiatives are still underway with no major cost incurred yet. - Future capital raising plans include potential equity infusion in Q4 FY26 or early FY27 to support scaling beyond current leverage levels (5x-6x), especially as AUM grows toward INR 2000-2500 crores in the next 2-3 years. - Long-term vision targets an AUM growth to INR 10,000 - 20,000 crores, implying substantial future capital and strategic investment in infrastructure and human resources to support such expansion.

- SRG Housing Finance plans to raise additional equity once leverage crosses 5x–6x, as banks usually limit leverage to this range. - Equity raising is expected possibly in Q4 FY27 or in the first or second quarter of the following year, depending on leverage visibility. - The company has strengthened its funding sources after the recent rating upgrade, with multiple channels now supporting growth (including banking channels, equity markets, and NCD investors). - There is no immediate challenge foreseen in terms of funding or business expansion due to diversified funding sources. - Cost of borrowing is expected to slightly decline over the next 1-2 years, reflecting improved liability profile. - No specific new debt issuance was mentioned, but continued support from NCD investors and banks is in place.

- As of FY 2026, SRG Housing Finance's Assets Under Management (AUM) stands at approximately INR 1,042 crores, reflecting strong growth from INR 28 crores in 2014. - The company targets to double the AUM to around INR 2,000 to 2,500 crores within the next 2.5 to 3 years. - They aim for a long-term vision of building an AUM book between INR 10,000 crores to INR 20,000 crores, with clarity expected within the next two years. - Disbursements for the current year are targeted at roughly INR 600 crores, expected to grow AUM to around INR 1,400 to 1,500 crores. - Expansion plans include launching 10 to 15 new branches in southern states like Tamil Nadu and Telangana, alongside growth in existing states to support scaling. - The company is well-capitalized with a capital adequacy ratio of 38.62% and plans for equity raising once leverage crosses 5x-6x to support AUM growth.