Target: ₹650
CMP: ₹501.50
Aadhar continues to demonstrate strong execution across growth, asset quality and profitability despite its large scale (AUM of ₹30,500 crore). PAT came in line at ₹310 crore, up 27 per cent year on year.
AUM grew 20 per cent, supported by disbursement growth of 20 per cent, led by robust traction in home loans, while LAP growth remained subdued. The management indicated a cautious stance on LAP amid macro uncertainty. It targets to grow AUM to ₹50,000 crore within the next three years (implying loan CAGR of over 18 per cent). We see Aadhar has levers to maintain its spreads: potential to increase non-home loans (27 per cent as of March 2026; expansion in tier-3 and beyond.
The management indicated no stress related to their customer cohort due to the West Asia war. Asset quality was strong with credit cost declining 11 bps quarter on quarter to 0.1 per cent and net slippages improving sharply on a quarterly basis.
Aadhaar’s geographic diversification and strong execution enable it to deliver consistent performance. It invested in distribution with branch count, up 8 per centY to 626. We upgrade our PAT estimates by 2-4 per cent for FY27/28E led by lower credit costs. We expect Aadhar to deliver AUM CAGR of 19 per cent with ROE of 17 per cent over FY26-29E. Valuation at 2.2x P/B FY28E and 14x P/E FY28E is attractive. TP ₹650.
Published on May 7, 2026