Strong growth offset by NIM compression, demand stabilizing

Delivered PAT +22.6% YoY (₹583→715 Cr); disbursements ₹19,509 Cr vs ₹14,651 Cr Q1 FY26 = +33%

Already declined 14 bps Q1 (3.8%→3.7%); spread flat 1.7%; acquisition pricing stable in prime; old book higher yield attriting into lower yield new book. Guidance credible.

Q1 benefited from ₹2,300 Cr assignment + Q4 Stage 2 over-provisioning not repeated. Disclosed transparently.

Improvement real, but margin compression (20-25 bps guidance) offsets opex leverage. NIM compression will limit further improvement.

Management cautious: 'stabilization phase' post price runup; BT-out slightly lower but 'watching Q2'; no double-digit confidence. Consistent with macro uncertainty flagged.

FY26 call guided NIM moderation from competition/elevated costs. FY27 quantifies 20-25 bps decline; Q1 already -14 bps. Credible on trajectory.

Prior: upper end of 2.0-2.2% range; FY27: 2.1-2.3% (same upper, floor raised 10 bps). Offset by NIM compression. No upgrade.

Prior: 'significant growth faster than industry.' FY27: 'industry 9-10.5%, muted vs prior, stabilization phase.' BT-out 'watching Q2.' Less confidence.

Improved to 19.6% Q1, but FY27 guidance 19-20% suggests NIM compression will limit further gains. Operating leverage muted.

Largely from yield attrition. Acquisition pricing stable in prime (banks price setters, HFCs price takers). Mix shift 84:16→80:20 offers modest uplift, but prime much larger than Sambhav.

No cheque handover interest accrual in BHFL; always been encashment basis even when unlisted. Consistent reporting.

Don't disagree with regulator spirit; practices will help sector grow resilient. Not impactful to company.

₹2,300 Cr assignment + higher Q4 Stage 2 provisioning not repeated. Two one-timers; guidance 10-15 bps normalized.

Spreads 3-4 bps movement (flat 1.7%). Margin compression from portfolio yields declining (attrition, yield compression).

Affordable 33-36% of Sambhav, ticket ₹18 L (upper affordable). Overall Sambhav ticket ₹28 L→₹26-27 L by year-end due to Tier 2/3 geo expansion.

LAP pool accounting: older high-provisioned account normalized vs new low-provisioned account moved in; net flat. DF: Stage 2 already over-provisioned 48-49% anticipating move; Stage 3 requires only 33-34%.

ECL model recalibrated Jan (better credit performance lowered Stage 1 rates); customer mix upgraded (higher bureau scores, AAA vs local developer); assignments impact. Moving pieces, not simple formula.

7-quarter history 50-70 bps corridor. This quarter at 62 bps is cyclical, not structural. No segment stress; one account moved.

Hedged book; natural repayment of old higher-cost borrowings; reset of some old borrowings at lower price. Q2 sideways with downward bias.

No, cautious not conservative. Tracking actual monthly yield in/out mathematically; not aggressive or defensive.

Insurance income linked to higher disbursements (+33%). Penal, foreclosure, bounce charges all variable business-linked.

Slightly lower but watching Q2 to confirm trend. Last year BT spiked post-June rate cut; don't want to assume trend without two quarters data.

Demand slightly muted, stabilization phase. Price momentum stopped. Likely 9-12% vs prior 12% assumption. Not double digit confident.

Not someone ceding; BHFL taking more of industry growth via deepening/widening in prime. Sambhav growing off low base. No player dynamic shift.

One-third affordable (33-36%), two-third near-prime. Disbursement mix stated only, not AUM mix.

Industry grew 9.4% FY26; assuming similar range FY27; demand muted but company taking share via new products.

Q1 +33% highest ever; management cautious on Q2 BT-out trends; watching for confirmation.

Already -14 bps in Q1; yield attrition structural (old higher-yielding book rolling off); limited repricing upside (acquisition pricing stable in prime).

Opex improved but NIM compression will offset leverage; incremental investments in Sambhav/affordable drag.

Currently ₹450-465 Cr monthly; on track; 73 urban, 72 rural; 65% bureau >750 discipline maintained.

Yield attrition fundamental (old book 8.9%+ yields rolling to new 7.5%+ yields in stable rate regime). Repricing blocked by stable acquisition pricing. 20-25 bps FY27 compression already material.

Industry growth muted 9-12% vs prior 12% assumption. BT-out slightly lower Q1 but management 'watching Q2' for trend confirmation. Price stabilization phase removing pre-buying urgency.

LAP GNPA 62 bps (46 bps prior); within 50-70 bps historical corridor but elevated. One account moved; management denies tech/Bangalore segment stress, but analyst raised concern on prior NBFC calls.

NHB conducting thematic audits on PLR computation, practices. Management downplayed ('not impactful'), but flagged as awareness risk.

Opex/NTI improved 21.2%→19.6% but guidance only 19-20% for FY27. NIM compression 20-25 bps will offset most opex gains; net profitability leverage flat to slightly negative.