CMP: ₹1,275.10
We met the management of Aavas Financiers (Manu Singh – MD and CEO) to discuss its business strategy and the near-to-medium term growth outlook.
Key takeaways: The management expects 16–18 per cent AUM growth in FY27 (disbursement growth of about 22–23 per cent) and around 20 per cent sustainable growth over the medium term. Housing remains a key focus area, with management aiming to maintain the HL/NHL mix at around 65:35, broadly in line with the portfolio mix.
While the increased focus on housing is likely to weigh on margins, management remains focused on risk-adjusted pricing, introducing new high-yielding state-specific products, and improving income per transaction to offset the pressure. Growth will be supported by branch additions, higher employee productivity, and customer retention, with management targeting to double field productivity per employee over the next two years.
Overall profitability will remain strong, supported by stringent cost controls, higher revenue per resource, and operating leverage. Overall, Aavas Financiers remains well placed to deliver sustainable growth, with stable asset quality and profitability outlook. We retain Add with Jun-27E target price of ₹1,600, implying a PBV of 1.9x.
With the ongoing implementation of its strategy and processes, we believe Aavas remains on track to deliver its 16-18 per cent AUM growth guidance in FY27 and sustain mid-teens ROE, with improving employee productivity, margins, and AUM growth expected to support continued execution and remain key monitorables.
Published on September 11, 2026
