Aavas Financiers Executive Committee has approved the issuance of unlisted secured non-convertible debentures worth approximately ₹975.00 crores to a multilateral institution. The approval was granted during the Executive Committee meeting held on December 23, 2025, pursuant to authority entrusted by the Board of Directors.

NCD Structure and Details

The debentures will be issued as unlisted, secured, unrated, redeemable and coupon bearing non-convertible debentures with a face value of ₹2.00 crores each. The issuance structure comprises two tranches with three series, designed to provide flexible financing options.

Tranche and Series Breakdown

The NCD issuance is structured in two distinct tranches comprising three series to optimize funding requirements and repayment schedules.

Coupon and Redemption Terms

The debentures feature differentiated coupon structures across series. Series 1 coupon will be determined near the actual issuance date based on agreed mechanisms, while Series 2 will carry Series 1 coupon minus 150 basis points. Series 3 will have the same coupon rate as Series 2.

Coupon payments will be made semi-annually, with Tranche 1 having a fourteen-period payment schedule and Tranche 2 having a twelve-period schedule. The company will partially redeem Tranche 1 debentures in 12 equal installments starting from the third coupon payment date, while Tranche 2 will be redeemed in 8 equal installments starting from the fifth coupon payment date.

Security and Regulatory Compliance

The debentures will be secured by a first ranking exclusive charge on specific and identified receivables that are not NPAs by RBI definition and have not been restructured in the past 12 months. The security cover will be maintained at 110.00% of the aggregate value of interest due and outstanding principal at all times.

The issuance is being conducted under the authority approved by members through special resolution passed at the 15th Annual General Meeting held on September 16, 2025, ensuring full regulatory compliance under the Companies Act, 2013 and applicable SEBI regulations.

Aavas Financiers , a leading affordable housing finance company, has reported a strong financial performance for the second quarter of fiscal year 2026 (Q2FY26), demonstrating resilience in a challenging market environment.

Key Financial Highlights

Improved Asset Quality and Operational Efficiency

Aavas Financiers maintained strong asset quality metrics in Q2FY26:

Expansion and Growth Strategy

The company has made significant strides in its expansion plans:

• Entered Tamil Nadu market with eight new branches
• Plans to add 20-25 branches in the second half of FY26
• Targeting to reach 405 branches across 14 states by the end of FY26

Management Commentary

Sachinder Bhinder, Managing Director and CEO of Aavas Financiers, commented on the results: "We have regained healthy momentum, delivering 36% quarter-on-quarter and 21% year-on-year growth in disbursements. With the second half being seasonally strong for us, we are working towards taking our monthly disbursement run rate to ₹700 crores plus."

Ghanshyam Rawat, CFO, added: "Our incremental cost of borrowing is almost 60 basis points better than last year, which is converting into better spreads."

Future Outlook

Aavas Financiers has set a target of reaching an AUM of ₹55,000 crores by FY30, implying a CAGR of approximately 23% from current levels. The company plans to achieve this through:

1. Geographic expansion into new states
2. Employee productivity enhancement
3. Investment in technology and sourcing channels

Conclusion

Aavas Financiers' Q2FY26 results demonstrate the company's ability to navigate challenging market conditions while maintaining strong growth and asset quality. With its strategic expansion plans and focus on operational efficiency, the company appears well-positioned to capitalize on the growing demand in the affordable housing finance sector.