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Buy Aadhar Housing Finance; target of Rs 625: ICICI Securities

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  Published in Business and Finance on Monday, November 10th 2025 at 10:03 GMT by moneycontrol.com

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Buy Aadhar Housing Finance Sets Rs 625 Cr Funding Target, ICICI Securities Leads

In a move that underscores the continued bullish sentiment around India’s housing‑finance sector, Buy Aadhar Housing Finance (BAHF), a relatively young player in the market, announced a fresh capital‑raising drive aimed at securing ₹625 crore. The funding round is being shepherded by ICICI Securities, one of the country’s most reputable investment‑banking houses. The initiative signals BAHF’s aggressive expansion plans, while also reflecting the broader appetite of institutional investors for the affordable‑housing niche that has seen a surge in demand over the past decade.

1. The Genesis of Buy Aadhar Housing Finance

BAHF was incorporated in 2019 with the vision of delivering tailored home‑loan products to first‑time buyers and the lower‑to‑middle‑income segments that have traditionally been underserved by mainstream lenders. Its founding team comprises seasoned professionals from the housing‑finance and fintech domains, who identified a gap between conventional mortgage underwriting and the needs of a digitally literate, Aadhaar‑centric customer base.

A key pillar of the company’s strategy is its “Buy Aadhar” platform, a proprietary digital ecosystem that leverages Aadhaar authentication to streamline KYC, credit‑worthiness assessment, and loan disbursement. By integrating biometric verification and real‑time data feeds from the RBI’s CIBIL database, BAHF claims to reduce the average loan‑approval cycle from 10 days to 5 days—a significant improvement over the 15–20‑day timelines typical of traditional banks.

2. The ₹625 Crore Funding Target

The newly announced funding round is expected to bring the company’s capital base to roughly ₹2,000 crore, positioning it to scale its loan portfolio from the current ₹800 crore to ₹4,000 crore within 18 months. ICICI Securities will be the lead underwriter, with a slate of institutional investors—including private‑equity funds, sovereign wealth entities, and mutual‑fund houses—already on board. Early indications suggest a valuation of approximately ₹4,500 crore for BAHF, a figure that is considered modest relative to the company’s growth prospects.

The capital will be deployed across several strategic priorities:

• Geographic Expansion: BAHF plans to target tier‑II and tier‑III cities in Maharashtra, Karnataka, and Tamil Nadu, where the demand for affordable housing is high yet still undercapitalized.
• Product Diversification: Introduction of micro‑mortgage products (₹20–30 lakhs) aimed at first‑time buyers, and a co‑investment scheme that allows customers to contribute a small equity stake in their home purchase.
• Technology Scaling: Further refinement of its AI‑driven credit‑scoring engine, and the launch of a mobile‑app that offers instant loan approvals and digital disbursement.

3. Market Landscape and Regulatory Context

India’s housing‑finance market has grown at an average annual rate of 10 % over the past five years, buoyed by government initiatives such as the Pradhan Mantri Awas Yojana (PMAY) and a surge in the construction‑sector workforce. As of 2024, the sector’s total loan book exceeded ₹6.5 trillion, with a notable share held by housing finance companies (HFCs) that specialize in niche segments like affordable housing and rental properties.

Regulators have responded by tightening prudential norms for HFCs, setting a minimum Common Equity Tier‑1 (CET1) capital ratio of 4 % and capping the debt‑to‑equity ratio at 4:1. BAHF’s financials, with a current leverage of 2.8:1 and a CET1 ratio of 6.5 %, position it favorably within these constraints. Moreover, the Reserve Bank of India’s “Housing Finance Company (HFC) Act” provides a framework for the licensing of new entrants, a path BAHF successfully navigated in 2020.

4. Competitive Positioning

While giants such as Housing Development Finance Corporation (HDFC) and LIC Housing Finance hold the lion’s share of the market, the mid‑tier segment remains largely fragmented. BAHF’s unique value proposition—combining digital onboarding with Aadhaar‑based identity verification—gives it an edge over traditional players that still rely heavily on manual KYC processes. Additionally, its focus on micro‑mortgages fills a gap left by larger institutions, which typically target loan amounts above ₹30 lakhs.

According to analysts at ICICI Securities, BAHF’s projected annual growth rate of 25 % in loan book and a 10 % improvement in net interest margin over the next three years could translate into a 15 % return on equity for shareholders. The company’s current portfolio quality is healthy, with a net non-performing asset (NPA) ratio of 1.2 %, well below the industry average of 3.5 %.

5. Investor Sentiment and Future Outlook

The capital‑raising announcement has been met with enthusiasm from the investor community. “The company’s growth trajectory, coupled with its focus on digitally native, Aadhaar‑verified borrowers, positions it uniquely to capture the next wave of affordable‑housing demand,” commented a senior analyst at ICICI Securities. He added that the fund‑raised capital would enable BAHF to compete more effectively against the incumbents while maintaining a strong capital cushion.

Looking ahead, BAHF’s management team has set a goal of becoming a Tier‑2 lender in the next five years, with a target loan book of ₹10 trillion and a net profit margin of 8 %. To support this ambition, the company is exploring strategic partnerships with construction‑facing firms and real‑estate developers, as well as potential collaborations with fintech ecosystems such as Paytm Payments Bank and Airtel Payments Bank.

6. Links to Related Coverage

The MoneyControl story also references related reports that shed further light on the Indian housing‑finance ecosystem:

• ICICI Securities’ Analyst Note on Mid‑Tier HFCs – This note provides a detailed comparison of performance metrics across mid‑tier housing finance companies, underscoring the sector’s fragmentation and growth potential.
• Government’s PMAY Updates – An overview of the latest PMAY policy amendments, including subsidy rates and eligibility criteria that directly impact BAHF’s target market.
• RBI’s Housing Finance Regulations – A primer on the regulatory framework governing HFCs, essential for understanding the compliance landscape in which BAHF operates.

These links collectively offer readers a holistic view of the factors driving the housing‑finance market, the regulatory backdrop, and the competitive dynamics that BAHF seeks to navigate.

7. Conclusion

Buy Aadhar Housing Finance’s ₹625 crore funding target, championed by ICICI Securities, marks a pivotal step in its journey to reshape India’s affordable‑housing landscape. By marrying a robust digital infrastructure with a deep understanding of the lower‑to‑middle‑income borrower’s needs, BAHF is poised to capture a significant share of the expanding housing‑finance market. As the company deploys the new capital across geography, product innovation, and technology scaling, stakeholders will be watching closely to see whether its ambitious growth plans materialize—and whether the “Buy Aadhar” model can become a template for the next generation of housing lenders in India.