Home First Finance Company India Limited, a prominent player in the affordable housing finance sector, reported a robust 26.3% year-on-year growth in Assets Under Management (AUM) to Rs. 14,178.00 crores for the quarter ended September 30, 2025. The company's performance showcased resilience amid challenges in specific markets and industries.

Key Financial Highlights

• Disbursements stood at Rs. 1,289.00 crores, up 9.6% year-on-year
• Profit after tax increased 43% year-on-year to Rs. 132.00 crores
• Net interest margin improved to 5.4% from 5.2% in the previous quarter
• Cost of borrowing reduced by 30 basis points to 8.1%

Expansion and Distribution

HomeFirst Finance continued its strategic expansion, growing its distribution network to 366 touchpoints and 163 branches. This represents a significant increase from 249 touchpoints and 101 branches three years ago, demonstrating the company's commitment to broadening its market presence.

Asset Quality Metrics

While the company reported strong growth, it faced some challenges in asset quality:

The company acknowledged challenges in specific markets, particularly Surat, Coimbatore, and Tirupur, due to tariff-related impacts on textile and leather industries.

Digital Adoption and Technological Advancements

HomeFirst Finance continues to leverage technology for operational efficiency:

• 83% of approvals facilitated via the account aggregator framework
• Over 80% of loans digitally fulfilled through e-agreements and e-NACH mandates
• 96% of customers registered on the mobile app

The company recently implemented an in-house developed treasury management system to enhance liquidity risk management and streamline operations.

Outlook and Strategy

Despite the challenges, HomeFirst Finance maintains a positive outlook:

• Credit costs maintained at 40 basis points
• Expects to bring asset quality metrics back to earlier levels over the next two quarters
• Focuses on early bucket resolutions and collection efforts

The company remains optimistic about business momentum in the second half of the fiscal year, citing improving macro-environment, easing interest rate cycle, and benign inflationary trajectory.

Earnings Call Insights

During the earnings conference call, management provided additional context:

• The company aims to reduce cost of borrowing to under 8% by March
• Expects net interest margins to expand due to reduced cash on the balance sheet and improved leverage
• Plans to add 4-5 new branches in the upcoming quarter
• Targets to increase co-lending contribution to 10% of disbursements as they scale

While facing some headwinds in specific markets, HomeFirst Finance remains committed to its growth strategy and maintaining asset quality through focused collection efforts and prudent underwriting.

Home First Finance Company India Limited , a technology-driven affordable housing finance company, has reported strong financial results for the second quarter of fiscal year 2026, demonstrating significant growth across key metrics.

Impressive Growth in Assets Under Management

The company's Assets Under Management (AUM) reached ₹141,781.00 million as of September 30, 2025, marking a substantial year-on-year growth of 26.3% and a quarter-on-quarter increase of 5.2%. This growth underscores Home First's expanding market presence and effective business strategies in the affordable housing finance sector.

Robust Financial Performance

Home First Finance reported a notable increase in its Profit After Tax (PAT), which rose to ₹1,318.00 million in Q2 FY26, representing a significant 43% year-on-year growth and a 10.9% increase quarter-on-quarter. This impressive profit growth reflects the company's operational efficiency and strong market position.

Key Financial Highlights

Stable Asset Quality

Despite the rapid growth, Home First has maintained a healthy asset quality. The Gross Stage 3 assets (GNPA) stood at 1.9% of the portfolio, indicating effective risk management practices.

Operational Expansion

The company continued to expand its physical presence, operating through 163 branches across 143 districts in 13 states and union territories. This strategic expansion has contributed to its growing customer base and market penetration.

Technology-Driven Approach

Home First's commitment to digital transformation is evident in its high digital adoption rates. The company reported that 96% of its customers are registered on the HomeFirst Customer Portal App, with 87% of service requests being raised through the app. This digital-first approach has likely contributed to operational efficiency and improved customer experience.

Management Commentary

Manoj Viswanathan, Managing Director and CEO of Home First Finance, commented on the results: "Q2 FY26 was another quarter of disciplined growth and steady execution, with our AUM reaching ₹14,178 crore. We continued to deepen our presence with a 163-branch network across 143 districts in 13 states. Our asset quality remains healthy and within our comfort bands, with a credit cost at ~40 bps."

Future Outlook

Looking ahead, the company remains optimistic about its business momentum, citing an improving macro environment, easing interest rate cycle, benign inflation trajectory, and proactive government and regulatory measures as key factors supporting growth.

Home First Finance's Q2 FY26 results demonstrate its ability to achieve strong growth while maintaining asset quality and leveraging technology for operational efficiency. The company's focus on the affordable housing segment, coupled with its expanding geographical presence, positions it well for continued growth in the coming quarters.

Note: All financial figures are in Indian Rupees (₹) unless otherwise stated.