Aptus Value Housing Finance India Ltd (APTUS) Share Analysis – Quality, Valuation Zone, Price Trend & DeciZen Rating

Aptus Value Housing Finance was founded by one of its Promoter, Chairman and Managing Director, M. Anandan, and it commenced its operations pursuant to a certificate for commencement of business, dated June 25, 2010, issued by the Registrar of Companies, Tamil Nadu at Chennai (then known as Registrar of Companies, Tamil Nadu, Chennai, Andaman and Nicobar Islands). The company is registered with the National Housing Bank (NHB) to carry out the business of a housing finance institution without accepting public deposits. Its marquee shareholders include WestBridge Crossover Fund, LLC, Malabar India Fund Limited (an affiliate of Malabar Investments), SCI Investments VI (an affiliate of Sequoia Capital), Madison India Opportunities IV (Madison India Capital) and Steadview Capital Mauritius Limited (an affiliate of Steadview Capital Management). It has and expects to continue to benefit from strong capital sponsors hip and professional expertise of its marquee shareholders.

The company is an entirely retail focussed housing finance company primarily serving low- and middle-income self-employed customer in the rural and semi-urban markets of India. The company offers customers home loans for the purchase and self-construction of residential property, home improvement and extension loans; loans against property; and business loans. The company has diversified its geographical presence by adopting a strategy of contiguous expansion across regions and focused on achieving deeper penetration in its existing markets.

The company has implemented a robust risk management architecture which is reflected in its asset quality. It conducts all aspects of its lending operations in-house including sourcing, underwriting, valuation and legal assessment of collateral and collections, which enables it to maintain direct contact with its customers, reduce turn-around-times and the risk of fraud. Over years, it has studied and developed credit assessment models specific to over 60 types of customer profiles. Some of its profiles are customized to regions and specific types of employment. It updates these profiles on a frequent basis for regional and local market specific developments and macro disruptions such as the COVID-19 pandemic. This has helped it to reduce subjectivity in forecasting the future income of potential customers, thus enabling robust credit underwriting. It has leveraged technology in various facets of its operations and has robust systems and processes to assist it with its underwriting and collections functions and to monitor asset quality. These systems and processes are also technology enabled with a view to ultimately digitize the entire life cycle of a loan from origination to closure. It has also implemented digitized collection models, which has led to an increase in its collection efficiencies.

Business area of the company

The company is a retail-focused housing finance company that primarily serves low and middle-income self-employed customers in the rural and semi-urban markets of India. The company offers home loans to retail customers to purchase homes, construct residential property, house improvement and extension, loans against property, and business loans. It undertakes all types of lending activities such as sourcing, underwriting, valuation, and legal assessment of collateral, the credit assessment, and collection.

Major events

• 2010: Incorporation of the company and receipt of certificate of registration from NHB.
• 2011: Opened first branch.
• 2012: Opened 20th branch and crossed 1,200 home loan disbursements.
• 2013: Loan book crossed Rs 900 million.
• 2014: Loan book crossed Rs 2,500 million.
• 2015: Expanded geographical presence to four states and loan book crossed Rs 7,000 million.
• 2018: Opened 100th branch and loan book crossed Rs 14,000 million.
• 2019: Expanded geographical presence to 143 locations and loan book crossed Rs 20,000 million.
• 2020: Expanded geographical presence to 175 locations, customer base reached 50,200 and loan book crossed Rs 30,000 million.
• 2021: Expanded geographical presence to 191 locations, customer base reached 65,683 and loan book crossed Rs 40,000 million.