The company’s asset quality remained strong with gross non-performing assets (GNPA) at 0.47 per cent at the end of the March quarter driven by in-house sourcing model, strong underwriting process and robust collection mechanism.
In the backdrop of the headwinds faced by the non-banking finance company (NBFC) industry during FY18-19, the company has maintained steady timely investments.
"In the current tight liquidity situation, the company's long term rating has been upgraded by CARE from 'A+/Positive' to 'AA-/Stable'," the management said.
"The rating assigned to the non-convertible debentures (NCDs) of the firm factors in the company’s experienced management team, it’s bolstered net worth base on account of fresh capital raising in FY18 and FY19 and its ability to scale up its operations while maintaining comfortable asset quality profile and granular loan book," CARE Ratings said.
According to ratings agency, India Ratings
and Research (Ind-Ra), the company is, relatively, in a better position to pass rising borrowing costs in the rising rate environment as it has lending presence towards housing for the lesser interest sensitive self-employed individuals in the rural and semi-urban areas,
"Aavas has demonstrated sustained business traction in the face of major headwinds (demonetisation), brand sustenance (post separation with Au Small Finance Bank Limited) and the recent system liquidity crunch. Fairly high growth, however, resulted in a fairly unseasoned loan book, though the static pool data suggests stable asset quality. Aavas’s risk-adjusted pricing and its focus on individual loans and avoiding builder-led disbursements provides comfort," the rating agency has said.
At 01:37 pm, the stock was trading 4 per cent higher at Rs 1,515 on the BSE, as compared to a 0.06 per cent rise in the S&P BSE Sensex. A combined 1,18,513 shares changed hands on the counter on the NSE and BSE.