Presently at less than 2.5% market share, your Company aims to achieve
a 5% share in home loan acquisition over the medium term. I believe it will get there
sooner than we think. Real estate remains a focus area for the government. The housing
finance sector has also witnessed good traction with overall outstanding home loan
portfolio at E33.34 lakh crore as of 31 March2024, a growth of 16.4%. ft
Dear Shareholder,
I am delighted to share two pieces of great news regarding your
Company.
The first: In its eight year of operations, Bajaj Housing Finance
Limited's (BHFL) assets under management (AUM) crossed RS.1 lakh crore. Indeed, it ended
FY2025 with an AUM of RS. 114,684 crore.
And the second: Your Company got its equity listed on the National
Stock Exchange (NSE) and the BSE Ltd. through a successful Initial Public Offering (IPO)
in September 2024. After more than three decades, a Bajaj Group company came to the equity
markets for listing. The IPO got a huge response from investors and became one of the most
successful ones in recent times.
Your Company is the largest Non-Deposit taking Housing Finance Company
in terms of AUM and second largest HFC in India.
Through its varied product suite, BHFL addresses the diverse mortgage
needs of all retail customer segments, which include salaried individuals, self-employed
and professionals. It serves all sub-segments, including prime, near-prime, and
affordable customers; and offers various transaction types such as
purchase, resale, self-construction, and balance transfer.
Through its commercial product suite, which includes construction
finance and lease rental discounting, BHFL caters to a wide range of marquee clients,
including real estate developers, high net worth individuals (HNIs), real estate
investment trusts (REITs), sovereign wealth funds and corporations.
As in earlier years, thanks to its commitment to meticulous
underwriting, focusing on the right segments of the housing mortgage market, superb
customer interface and excellent execution, your Company has posted excellent operational
and financial results. Let me share some of these.
• AUM increased by 26% to RS. 1,14,684 crore
• Net interest income grew by 20% to RS. 3,007 crore
• Net total income (NTI) rose by 23% to RS. 3,597 crore
• Operating expenses to NTI improved to 20.8% in FY2025 from 24.0%
in FY2024
• Pre-impairment operating profit grew by 28% to RS. 2,850 crore
• Profit before tax (PBT) increased by 28% to RS. 2,770 crore
• Profit after tax (PAT) rose by 25% to RS. 2,163 crore
• Capital adequacy ratio stood at 28.24% as of 31 March2025. The
Tier-1 ratio was 27.72%; both are well above regulatory norms.
In FY2025, your Company set up an Affordable and Near Prime Strategic
Business Unit (SBU) to address the mortgage needs of the 'Near Prime and Affordable'
customers. With this, BHFL is now the most diversified and full mortgage product suite
Company in the country serving the entire spectrum of customer sub-segments, including
prime and non-prime (i.e. near prime and affordable).
To deliver seamless experience, BHFL launched a customer onboarding
platform where a customer, the Company's salesforce and channel partners can login the
loan application digitally and parallelly work on the fulfilment of the application from
anywhere - all of which directly flows to the centralised underwriting team.
BHFL's compliance philosophy revolves around the following principles
• Regulatory compliance with all applicable laws, regulations, and
guidelines,
• Customer protection where the Company prioritizes the protection
of its customers' interests and data,
• Ethical conduct in its dealings with customers, partners, and
colleagues,
• Robust risk management frameworks and processes to identify,
assess, and mitigate risks associated with its operations and
• Comprehensive employee training and awareness to enhance the
compliance knowledge and awareness of its employees.
Presently at less than 2.5%, your Company aims to achieve a 5% market
share in home loan acquisition over the medium term. I believe it will get there sooner
than we think. Real estate remains a focus area for both the central and state governments
and is evident through its various initiatives such as the Real Estate Regulatory
Authority (RERA), the Pradhan Mantri Awas Yojana for interest subsidies, infrastructure
development allocations and increasingly rapid digitisation of land records. The housing
finance sector has also witnessed good traction with overall outstanding home loan
portfolio at RS.33.34 lakh crore as of 31 March2024, representing a 16.4% growth against
31 March2023.
Given the quality and commitment of the team, I see BHFL growing in the
foreseeable future - offering more home loans to a greater number of people, financing
even more commercial real estate, generating superior operational and financial returns
and delivering long-term value to the shareholders.
May it continue to prosper.
Thank you for your support. And my special thanks to each employee in
BHFL who have made such results happen.
Yours sincerely,