SRG Housing Finance Limited (SRGHFL) has reported robust financial results for the second quarter of fiscal year 2026, showcasing significant growth across key metrics. The company's strategic expansion and focus on the affordable housing segment have contributed to its impressive performance.

Key Financial Highlights

Improved Asset Quality and Funding Profile

SRGHFL has maintained a stable asset quality with a slight improvement in its gross non-performing assets (GNPA) ratio, which stood at 1.88% compared to 1.96% in Q2 FY25. The net NPA ratio was reported at 0.64%, up marginally from 0.59% in the same quarter last year.

The company's funding profile has diversified, with outstanding borrowings reaching INR 685.00 crore. The breakdown of funding sources is as follows:

• Banks: 45%
• Financial Institutions: 44%
• Non-Convertible Debentures (NCDs): 7%
• National Housing Bank (NHB): 4%

Notably, SRGHFL successfully issued NCDs worth INR 50.00 crore in Q2, with an additional INR 26.00 crore issued in the current quarter. The company's Managing Director, Mr. Vinod Kumar Jain, highlighted that a mutual fund has invested in the INR 50.00 crore NCD issuance, marking a significant milestone for the company.

Operational Expansion and Future Outlook

SRGHFL has been actively expanding its geographical presence, with operations now spanning across Rajasthan, Maharashtra, Karnataka, and Andhra Pradesh. The company currently operates 93 branches and plans to increase this number to 100 by the end of the fiscal year.

For FY26, SRGHFL has set the following targets:

• Assets Under Management (AUM): INR 970.00 crore
• Disbursements: INR 400.00 crore

The company's credit rating has been upgraded to BBB+ with a positive outlook, which is expected to further improve its borrowing costs and access to funds.

Management Commentary

During the earnings conference call, Mr. Vinod Kumar Jain, Managing Director of SRGHFL, stated, "Our focus on sustainable growth and disciplined approach to lending has resulted in strong performance across key metrics. The improved credit rating and diversification of our funding sources, including the recent NCD issuances, position us well for future growth."

Mr. Jain also emphasized the company's commitment to maintaining asset quality while expanding its presence in new geographies. He noted that the average ticket size in the new markets of Maharashtra, Andhra Pradesh, and Karnataka is around INR 20-25 lakhs, higher than the company's traditional markets.

As SRG Housing Finance continues to execute its growth strategy, it remains focused on catering to the affordable housing segment in tier 2 and tier 3 cities, leveraging its deep understanding of local markets and customer needs.

SRG Housing Finance Limited has successfully raised INR 26 crores through the allotment of non-convertible debentures (NCDs) in a private placement on October 24, 2025. This move demonstrates the company's ability to secure funding in the current market environment.

Key Details of the NCD Issuance

Security and Investors

The NCDs are secured by an exclusive charge over SRG Housing Finance's receivables portfolio, maintaining a minimum security cover of 1.1 times. This arrangement provides additional assurance to the investors regarding the company's commitment to meeting its financial obligations.

The private placement attracted four investors:

1. MUFIN Green Finance Limited
2. Anaaya Avinash Wadhwa
3. PH Financial and Investments Private Limited
4. Usha Parsram Wadhwa

The full subscription of the offering indicates investor confidence in SRG Housing Finance's financial stability and growth prospects.

Implications and Outlook

This successful NCD issuance may provide SRG Housing Finance with additional capital to support its operations and potential expansion plans. The 5.5-year tenure of the debentures suggests a long-term funding strategy, which could allow the company to plan and execute its business objectives with greater financial flexibility.

For investors, the 11.52% annual interest rate with monthly coupon payments offers an attractive fixed-income opportunity in the current market. The listing of these NCDs on the BSE Limited is expected to provide liquidity to the investors, subject to market conditions.

As the housing finance sector continues to evolve, SRG Housing Finance's ability to secure funding through various instruments may be crucial for its competitive positioning and growth strategies in the coming years.