Motilal Oswal Home Finance, a wholly-owned subsidiary of Motilal Oswal Financial Services (MOFSL), continues to demonstrate strong business fundamentals. Motilal Oswal Home Finance Q1 FY26 delivered impressive results, supported by healthy loan growth, robust disbursement momentum, and stable asset quality. The company’s strategic focus on expanding into underpenetrated markets, combined with its technology-driven operating model, is further strengthening its position in India’s affordable housing finance segment.
1. Loan Book Growth and Disbursement Momentum
MOHFL Q1 FY26 loan book expanded to INR 5,006 crore as of June 2025, up 22% YoY from INR 4,098 crore in June 2024. This growth was supported by sustained traction in both retail and non-retail segments.
- Disbursements stood at INR 395 crore in Q1 FY26, marking a 57% YoY jump from INR 252 crore in Q1 FY25.
- Growth was propelled by:
- Expanding into Tier-2 and Tier-3 geographies
- Increasing the strength of its Sales Relationship Manager (RM) network
- Leveraging digital channels for faster loan origination
“MOHFL’s focus on widening geographical distribution and expanding RM bandwidth is paying dividends, with strong disbursement momentum expected to continue in upcoming quarters,” said a company source.
2. Motilal Oswal Home Finance Q1 FY26: Financial Metrics
| Metric | Q1 FY25 | Q1 FY26 | YoY Change |
|---|---|---|---|
| AUM (INR Cr) | 4,122 | 5,027 | ↑ 22% |
| Yield (%) | 14.0 | 13.6 | ↓ |
| Cost of Funds (COF) (%) | 8.4 | 8.4 | Stable |
| Spread (%) | 5.6 | 5.2 | ↓ |
| NIM (%) | 7.3 | 6.9 | ↓ |
| Opex/AUM (%) | 4.7 | 4.7 | Stable |
| ROA (%) | 2.6 | 1.8 | ↓ |
| ROE (%) | 9.0% | 6.6 | ↓ |
| Net Worth (INR Cr) | 1,321 | 1,460 | ↑ 11% |
While spreads and margins saw slight compression due to competitive pricing and a stable but elevated COF, profitability remained resilient owing to cost control and operational efficiency.
3. Asset Quality: Stable and Controlled
Motilal Oswal Home Finance Q1 FY26 highlights a disciplined credit risk profile:
- GNPA steady at 1.2% (unchanged YoY)
- NNPA stable at 0.6%
- Continued focus on affordable housing borrowers with low-risk profiles.
The company’s consistent asset quality reflects strong underwriting practices, AI-enabled credit assessment, and proactive collection mechanisms.
4. Motilal Oswal Q1 FY26: Operational Efficiency
MOHFL Q1 FY26 operational metrics highlighted improved branch productivity and cost discipline:
- Retail Loan Book per Branch rose with higher ticket size penetration in focus markets.
- Disbursement per Branch improved with digitisation-led efficiencies.
- Opex-to-AUM ratio held at 4.7%, despite strategic investments in expansion and technology.
5. Capital Position and Leverage
With a CRAR of 40.8% (vs. regulatory minimum of 15%) and net leverage at 2.3x, MOHFL remains well-capitalised to support growth ambitions. The healthy net worth growth further strengthens the balance sheet.
6. Treasury & Strategic Investments
MOHFL’s treasury operations continue to provide stability and flexibility:
- Treasury investments stood at INR 8,853 crore with an XIRR of 20.1% since FY14.
- “Skin in the game” exceeds INR 11,000 crore from sponsors and promoters.
This strong treasury performance offers a buffer during market volatility and enables opportunistic investments in growth areas.
7. Outlook
Management’s strategic priorities for FY26 include:
- Deepening affordable housing penetration in semi-urban and rural markets.
- Scaling the digital lending platform for faster turnaround times.
- Sustaining asset quality discipline despite aggressive growth.
- Leveraging the RM network to unlock higher productivity.
With India’s housing demand strengthening and regulatory push for affordable home ownership, MOHFL is positioned to capture market share while maintaining prudent risk management.
Q1 FY25 vs. Q1 FY26 – Key Takeaways
| Metric | Q1 FY25 | Q1 FY26 | Change |
|---|---|---|---|
| Disbursements | 252 | 395 | ↑ 57% |
| Loan Book | 4,122 | 5,027 | ↑ 22% |
| Net Interest Income | 82 | 94 | ↑ 15% |
| PAT | 29 | 24 | ↓ 17% |
| GNPA (%) | 1.2% | 1.2% | Stable |
| NNPA (%) | 0.6% | 0.6% | Stable |
- Disbursement Surge: Significant YoY growth demonstrates market penetration.
- Loan Book Expansion: Robust growth supported by both retail and non-retail segments.
- Profitability Dip: PAT impacted by higher strategic investment phase costs.
- Stable Asset Quality: No deterioration despite rapid portfolio expansion.
Conclusion
Motilal Oswal Home Finance Q1 FY26 results underscore its ability to balance high growth with stable asset quality. While profitability dipped due to deliberate investments in people, processes, and technology, these steps are laying the foundation for sustainable long-term expansion. The company’s capital strength, strong treasury, and disciplined lending make it a formidable player in the housing finance space as it navigates an increasingly competitive market.
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