Aadhar Housing Finance Limited, established in 2010, is a prominent housing finance company in India catering primarily to the lower-income segment.
Aadhar Housing Finance is a leading provider of mortgage-related loans, specialising in serving the low-income housing segment in India. Their focus on economically weaker and low-to-middle-income customers has earned them recognition, boasting the highest Assets Under Management (AUM) and net worth among peers, according to CRISIL. With a widespread presence across 20 states and union territories, they cater to diverse geographic needs, reducing the concentration risk.
The company operates through a widespread network of 471 branches, including 91 sales offices across 20 states and union territories. With a presence in about 10,926 pin codes, Aadhar Housing Finance targets customers in tier 4 and tier 5 towns, aiming to make financing accessible at the grassroots level.
As of September 2023, the company employs 3,695 staff, and its subsidiary, Aadhar Sales and Services Private Limited, has an additional 1,851 employees. The firm offers a variety of mortgage-related products for both residential and commercial properties, alongside home improvement and extension loans.
Additionally, Aadhar Housing Finance has successfully served 246,983 customers nationwide. The company also benefits from its network of 12,221 Aadhar Mitras, which earn referral fees by sourcing customer loans.
Active participation in government initiatives like the PMAY Scheme underscores their dedication to affordable housing, with substantial subsidies for economically weaker segments. As they expand strategically, Aadhar Housing Finance remains a key player in driving housing finance accessibility for rural and semi-rural communities.
Industry Outlook
- Given that 1.52 billion people are estimated to live in India by 2031 and that 37.4% of them will live in cities, Aadhar Housing Finance is well-positioned to meet the country's expanding housing demands. There is a large market potential due to the increase in middle-class families, which is expected to reach 181 million by Fiscal 2030 from 41 million in Fiscal 2012.
- Between 2014 and 2021, the percentage of adults with bank accounts increased from 53% to 78%, providing Aadhar Housing Finance with access to a larger consumer base. In comparison to other nations, India's credit penetration rate is still low, suggesting significant potential for expansion. The whole amount of outstanding house loans as of March 2023 was over ₹31.1 trillion, indicating the market's substantial unrealised potential.
Aadhar Housing Finance IPO Details
Aadhar Housing Finance IPO Date
Aadhar Housing Finance IPO is open from May 8, 2024, to May 10, 2024. The IPO will be listed on BSE and NSE.
Aadhar Housing Finance IPO Price Band
Aadhar Housing Finance is a book-built issue IPO. The price band is set at ₹300 to ₹315 per share per share.
Aadhar Housing Finance IPO Lot Size
The minimum lot size for retail investors of Aadhar Housing Finance IPO is set at 1 lot of 47 shares.
Aadhar Housing Finance IPO Objectives
The company plans to allocate the net proceeds from the issue for the following purposes:
- The company proposes to utilise ₹7,500 million of the investment toward meeting future capital requirements for onward lending.
- Deploy funds towards general corporate purposes, not exceeding 25% of the Gross Proceeds, as per SEBI ICDR Regulations. This includes strategic initiatives such as expanding distribution network, advancing information technology, meeting operating expenses, and addressing general corporate exigencies and contingencies.
Peer Details
As per DRHP, the company has 4 listed peers, which are mentioned below:
- Aavas Financiers Limited
- Aptus Value Housing Finance India Limited
- Home First Finance Company India Limited
- India Shelter Finance Corporation
How To Check the Allotment Status of the Aadhar Housing Finance IPO?
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Contact Details of Aadhar Housing Finance IPO
Registered office: 2nd floor, No.3, JVT Towers, 8th‘A’, Main Road, Sampangi RamaNagar, Bengaluru 560 027, Karnataka, India
Phone: +91 22 41689900
E-mail: complianceofficer@aadharhousing.com
Aadhar Housing Finance - Financial Performance
| Particulars | As at December 31, 2023 | Year ending on March 31, 2023 | Year ending on March 31, 2022 |
|---|---|---|---|
| Revenue(Amount in ₹ Crore) | 1,895.17 | 2,043.52 | 1,728.56 |
| Profit After Tax (PAT) (in ₹ Crore) | 547.88 | 545.34 | 446.20 |
| Cash and Cash Equivalents (in ₹ million) | N/A | 4,051.4 | 5,741.7 |
| Return on Net Worth (%) | N/A | 14.7% | 14.1% |
| Total Borrowing (in ₹ Crore) | 13,127.59 | 12,153.45 | 10,674.59 |
| EBITDA (₹ in million) | N/A | 15,365.0 | 13,418.1 |
Know before investing
Strengths
5Aadhar Housing Finance is India's leading low-income sector HFC with the highest net worth and AUM among competitors.
The company features a growing gross AUM and an extensive branch network that is well-equipped to meet its target demographic.
It has robust systems for risk management, including credit evaluation and collections, which enhance profitability and asset quality.
Technology-driven solutions facilitate efficient loan processing and accurate credit decisions.
Operating across 20 states and union territories, Aadhar Housing Finance specialises in reaching semi-urban areas with products like Aadhar Gram Unnati, enabling broad market penetration.
Risks
5Regulatory investigations into former promoters could negatively impact Aadhar Housing Finance and its share value.
Strong promoter control may restrict shareholder influence and delay key decisions, affecting business outcomes.
Reliance on external information could lead to inaccuracies in credit evaluations, increasing NPAs and risking financial stability.
