Home First Finance Company India Limited — Investor Meet, 04-02-2025: Analysts/Institutional Investor Meet/Con. Call Updates

**Financial Performance:** Home First Finance Company reported an impressive financial performance for the quarter ended December 31, 2024. The company achieved a profit after tax of INR 97 crores, reflecting a 24% increase year-over-year and an ROE of 16.6%. Assets Under Management (AUM) grew by over 30%, crossing INR 12,000 crore. Despite some margin compression, net interest margins stood at 4.9%, impacted by higher borrowing costs and liquidity levels. The company maintained a robust asset quality, with a gross NPA of 1.7% and early-stage delinquencies showing stable trends.

**Future Outlook and Growth Drivers:** Management expressed optimism regarding growth, targeting a 30% increase in AUM over the next few years. Plans for branch expansion remain aggressive, with expectations to open around 10 additional branches in the current quarter and a total of 30-40 branches in FY26. The focus will also be on leveraging technology and data analytics to enhance operational efficiency.

**Order Book and Operational Updates:** Despite facing a minor dip in quarterly disbursals, totaling INR 1,193 crores, management expects a rebound, attributing past shortfalls to tighter credit filters and regulatory challenges. Operationally, there were 69 branches added in the past 11 quarters, amplifying the company’s presence across 13 states.

**Analyst Q&A Insights:** Analysts raised questions about revenue projections and operational challenges, especially around the tightening of credit filters, which management clarified would not have a long-term impact on disbursal volumes. Concerns about increasing competition in the affordable housing sector were addressed, emphasizing that Home First is focused on maintaining its specific market segment.

**Market or Regulatory Updates:** Management highlighted improvements in its ESG score and plans for further equity capital raising, showcasing confidence in future growth in the affordable housing market.

**Strategic Focus Areas:** The company is prioritizing technology integration, asset quality management, and expanding its customer base, with a particular focus on emerging markets like Madhya Pradesh and Uttar Pradesh.

**Investor Insight:** Given Home First’s strong financial health, consistent growth trajectory, and adept management strategies in handling current market dynamics, a favorable outlook suggests the potential for a ‘buy’ stance from investors, provided ongoing market conditions remain stable.