SRG Housing Finance Q1 FY27 earnings call

What moved the numbers, as management explained it

• Disbursement slowdown initiated as a precaution; MD expects Q2 to bear the impact and Q3-Q4 to recover.
• Q1 PAT grew about 25 percent YoY; driven by existing book accrual even as fresh sanctions were pulled back.
• Loan book cited at around Rs 1,100 cr with 15,000 active accounts out of 25,000 total and average ticket Rs 12 lakh; MD argued Rs 400 cr siphoning is mathematically implausible.
• Promoter personal guarantees to majority of bank lenders and 1 percent stake increase cited to support credit story during Red Flag period. (accounting)

The numbers management led with

• Capital adequacy ratio: 39.21% (more than double regulatory minimum)
• Active loan accounts: 15,000 active accounts out of 25,000 total; KYC and field verification complete on all
• Monthly collection: Rs 8-10 crores per month
• Liquidity buffer: 2-3 months of repayment obligations

Guidance on this call

What changed since the Tue 12 May 2026 call

Balance sheet, capex and funding

• Capital adequacy ratio at 39.21 percent.
• Liquidity buffer of 2-3 months of repayments; monthly collections Rs 8-10 cr against obligations.
• NHB refinance outstanding stated at Rs 15 cr; no loan acceleration or recall by any lender.
• Promoters increased stake by 1 percent and stand ready to infuse further capital if needed.
• Acuite rating kept under watch with no downgrade; one-year liquidity position submitted to rating agency.
• Liquidity statement covers period up to next March, per MD.

Risks management named

• Q2 FY27 numbers will reflect slowdown in fresh sanctions and disbursements
• Red Flag status creates lender caution and reputational risk; conversion to NBFC requires NOCs from all lenders
• Borrower EMI behaviour could deteriorate if collection-base panic spreads, despite no current stress
• Concentration risk in Rajasthan — analyst flagged that regional stress in the state is rising

Not answered directly

• Specific liquidity figures (monthly collections, cash balance, FDs without lien) — MD refused, asked investors to wait for results
• NHB audit outcome scenarios — MD refused to pre-judge, said only the audit can tell
• Disclosure of monthly collection efficiency / ALM buckets — deferred with 'let us see'
• NHB formal communication content — described as internal, not publicly shareable
• Newspaper rebuttal specifics — only confirmed email was sent, refused to share text with investors

Asked for a number, answered without one

• Specific liquidity buffer / cash balance: MD declined to give a figure; only said buffer of 2-3 months of repayments and liquidity submitted to rating agency covers till next March.
• Monthly collection and obligation figures: Said collections are more than obligations and mentioned Rs 8-10 cr monthly collections only while arguing the siphoning claim is impossible; refused to give a number when directly asked.
• NHB audit completion timeline: Said it will close very soon, within a week or two, and separately 100 percent in 1-2 months and 15-20 days at different points; no firm date given.

Every question, with its answer

1. 1. NHB RFA reason

   Jinal Sheth, Awriga Capital

   Question. Why was the account red-flagged in the first place from your end, and could there be any classification issues?

   Answer, Vinod Kumar Jain, Managing Director, SRG Housing Finance Limited. It is a regulatory internal audit process; NHB does not tell the company why it is red-flagged — it happens as the audit goes on. Once the audit is over and the red flag is removed, details will be known. MD commits 100% compliance with whatever classification outcome emerges.

   Follow-up. So we will get to know the reasons later? Could there be classification issues?

   Answer. Yes, when the audit is over we will know everything. The classification is done in the audit itself; whatever the outcome, we will comply 100% and move forward.

   Not answered directly.

2. 2. Third-party audit and NPA manipulation

   Harsh Chaurasia, Orbit Exports Family Office

   Question. Can a third-party re-inspection be arranged through NHB to validate the books? Separately, how do you address the NPA manipulation allegation in the article given that NPA is monitored daily?

   Answer, Vinod Kumar Jain, Managing Director, SRG Housing Finance Limited. On third-party re-inspection: no problem getting it done after the audit closes, for satisfaction. On NPA manipulation: information is based on the newspaper report which the company has already denied; all clarifications will come from the audit outcome. Tells investors to keep faith and not react so quickly on news.

   Not answered directly.

3. 3. Liquidity and ALM position

   Rahul Jain, Individual Investor

   Question. What is the company's liquidity position — monthly inflows, outflows, cash and bank balance, FD without lien, and liquidity buffer maintained? Also, since the NHB audit happens annually, was anything different checked this time?

   Answer, Vinod Kumar Jain, Managing Director, SRG Housing Finance Limited. MD refuses to disclose specific monthly collection/outflow amounts or cash balance figures, deferring to results announcement. States the company has always kept close liquidity to fulfil future obligations and has cash flow dispersion; confirms a buffer of 2-3 months of repayment. NHB audit is annual with the same checklist every year; no new scope.

   Not answered directly.

4. 4. NHB communication; NBFC rationale

   Prashant Talpade, Individual Investor

   Question. Has NHB communicated anything matching the article's claims of fictitious accounts and NPA under-reporting? How long after red flag will concerns be rectified, and how long will disbursement stay slow? Also, why convert to NBFC instead of keeping HFC and creating an NBFC subsidiary? Why no collection delays from worried borrowers?

   Answer, Vinod Kumar Jain, Managing Director, SRG Housing Finance Limited. States NHB has not communicated anything matching the article. Red flag reasoning is not shared during audit. On restructuring: process happens hand-in-hand with NHB. Disbursement slowdown is precautionary; lenders comfortable, no cash flow mismatches, no requests for prepayment. Argues siphoning is practically impossible: average ticket of Rs 12 lakhs across 5,000 accounts to reach Rs 400 cr; states zero promoter-related loans. No collection delays reported. On NBFC conversion, MD argues running two entities for the same activity is not right; one entity can do both.

   Not answered directly.

5. 5. Board oversight and NHB engagement

   Jayanta Jana, DCB Bank

   Question. How is the Board monitoring the RFA tagging and the reporting on it? Has there been a physical meeting with the NHB audit team in person, or only email communication? Any promoter capital-infusion plan to absorb impact of operating costs during disbursement slowdown?

   Answer, Vinod Kumar Jain, Managing Director, SRG Housing Finance Limited. States talks with NHB are regular and ongoing; audit will conclude very soon. Board is confident with no issue in the company. On capital infusion: no shortfall in operations right now; slowdown is not a long-term issue (5-15 days to a month). Teams and staffing are kept ready to resume business.

   Not answered directly.

6. 6. News leak and Q2 outlook

   Rohit Arora, Individual Investor

   Question. Was there any reason for the news article to be leaked, and is business-as-usual continuing in Q2?

   Answer, Vinod Kumar Jain, Managing Director, SRG Housing Finance Limited. MD says if there were no news, nothing could have been leaked; the report is entirely false and there is no cause for concern. Q2 will see a little slowdown but Q3 and Q4 will be good.

7. 7. Proactive NHB and lender feedback

   Rahul Jain, Individual Investor

   Question. Has the company taken any proactive step like writing to NHB requesting the reason for the red flag, or any formal communication, and what is the feedback from lenders after the meetings?

   Answer, Vinod Kumar Jain, Managing Director, SRG Housing Finance Limited. MD reiterates this is an audit process and nothing will be done proactively — once the audit closes, things will work out. On lenders: 'lenders live on finance, they know everything' — how cash flow mismatches work, and a Rs 400 cr siphoning would have been visible in payment delays which never happened; lenders comfortable.

   Not answered directly.

8. 8. NHB communication and ET action

   Manish Singh, Capital Small Finance Bank

   Question. Has any formal communication been received from NHB other than the audit, and specifically has a list of accounts with concerns been shared? What action has been taken against the Economic Times for reporting this?

   Answer, Vinod Kumar Jain, Managing Director, SRG Housing Finance Limited. States no formal communication other than the audit; the list of concerning accounts is not shared and comes at closing. Confirms the company has approached Economic Times via email regarding the article. MD does not detail the response received.

   Not answered directly.

9. 9. Newspaper rebuttal and sanction timeline

   Premanand Mulaye, SVC Bank

   Question. Will the company publish a clarification in the newspaper given it claims misrepresentation? Tentative timeline for audit completion? And would already-issued sanctions need to be cancelled if not drawn within 90 days under RBI guidelines?

   Answer, Vinod Kumar Jain, Managing Director, SRG Housing Finance Limited. On newspaper clarification, MD only confirms an email was sent to ET saying the information is wrong; cannot share the email publicly — investors can talk separately if interested. On timeline: audit takes time but being closed soon; 15-20 days expected. On RBI 90-day sanction rule: 'We will do it, there is still time left.'

   Not answered directly.

10. 10. Audit precedent and likely outcome

    Harsh Chaurasia, Orbit Exports Family Office

    Question. If NHB has been doing annual audits, how could a Rs 400 cr issue have appeared when AUM grew only Rs 200-250 cr YoY? And in MD's 20-25 years of experience, what could realistically be flagged in the audit — is it likely a small penalty or something major?

    Answer, Vinod Kumar Jain, Managing Director, SRG Housing Finance Limited. MD distinguishes that the allegation is siphoning — money coming out of the system — rather than reclassification. Refuses to pre-judge the audit outcome; describes it as 'a regular audit, not the first time'. Cannot speculate on what could be flagged.

    Not answered directly.

11. 11. Lender acceleration and part-disbursement

    Manoj Kumar, ESAF Small Finance Bank

    Question. Has there been any lender-side acceleration, recall, or adjustment on any account? Has the company also paused part-disbursements on existing tranches?

    Answer, Vinod Kumar Jain, Managing Director, SRG Housing Finance Limited. No acceleration or recall on any account. Part-disbursements are still ongoing where necessary; only fresh sanctions and new disbursements have been slowed, not part-disbursements of existing loans.

12. 12. Audit timing and lender meet

    Shivanand, Karnataka Bank

    Question. When did the NHB audit start, how long does it typically go on, and were individual meetings held with bankers rather than a lenders' meet? Request for a structured lenders' meet as a confidence-building step.

    Answer, Vinod Kumar Jain, Managing Director, SRG Housing Finance Limited. NHB audit started in July 2026; typically runs for around two months. Confirms individual meetings held with every banker because each wanted individual engagement. On a formal lenders' meet, MD says 'we will see'.

13. 13. Mortgage registration and proactive disclosure

    Ravi Purohit, Securities Investment Management Private Limited

    Question. Can MD confirm 100% of mortgages are centrally registered, given fictitious-account concerns? And given the MFI precedent (PNB Housing, DHFL), would SRG share monthly collection-efficiency and ALM data until audit is fixed to rebuild trust?

    Answer, Vinod Kumar Jain, Managing Director, SRG Housing Finance Limited. MD confirms 100% central registration of mortgages, arguing fictitious-borrower allegations are practically impossible — without KYC and documentation across multiple banks, Rs 400 cr in a Rs 1,100 cr book with average ticket of Rs 12 lakhs across 5,000 accounts is structurally not feasible. On monthly disclosure: acknowledges suggestion, says equity is in the second-generation and 'this is not just today's business' — will pay attention to suggestion; has already shared liquidity position with rating agency and there is no rating downgrade.

    Partly answered.

14. 14. Contingency plan and liquidity buckets

    Nihar Jena, Bandhan Bank

    Question. If the audit does not close in 1-3 months, is there a contingency plan in place? And is the liquidity position submitted to the rating agency adequate/positive or negative for 3-month and 6-month buckets?

    Answer, Vinod Kumar Jain, Managing Director, SRG Housing Finance Limited. MD expresses 100% confidence audit will close within 1-2 months and says 'why will it not happen?'. Liquidity position: confirmed to be okay till next March, will share the statement.

    Not answered directly.

15. 15. Account count, NBFC products, evergreening

    Vaibhav Tiwari, Lighthouse Canton

    Question. 15,000 vs 25,000 accounts reconciliation: which is correct? Which specific NBFC segments will SRG target post-conversion, and have lenders been spoken to on financing cost? How does MD respond to the evergreening and fictitious book allegations given rising regional stress in Rajasthan?

    Answer, Vinod Kumar Jain, Managing Director, SRG Housing Finance Limited. Clarifies 25,000 is total accounts and 15,000 are active; all 25,000 have KYC done. On NBFC segments: a future plan with at least 6 months processing including NOCs. On evergreening/fictitious book: 'all allegations when the audit report is completed — nothing is authenticated as of now'. On lenders: 'lenders understand practically' and are comfortable.

    Not answered directly.

16. 16. Promoter capital commitment

    Rahul Jain, Individual Investor

    Question. Can the promoter specify how much additional capital can be infused if the need arises?

    Answer, Vinod Kumar Jain, Managing Director, SRG Housing Finance Limited. Confirms promoters can put 100% capital in the company if need arises, and will do it according to the need. Frames this against the company's multi-decade history.

17. 17. NHB refinance and ET communication

    Mohit Wahi, Utkarsh Small Finance Bank

    Question. Is the NHB audit outstanding Rs 19-20 cr or Rs 15 cr? And please share the email communication with Economic Times if a response is received.

    Answer, Vinod Kumar Jain, Managing Director, SRG Housing Finance Limited. Clarifies the NHB refinance outstanding is Rs 15 crores (not Rs 19-20 cr). Confirms company will share any reply from Economic Times with the investor; agrees that NHB not making an official statement should also be flagged back at the newspaper.

18. 18. Lender confirmation letters

    Avinash K, City Union Bank

    Question. Request for written audit-purpose confirmation letters to be sent to the lender bank to complete its own audit.

    Answer, Vinod Kumar Jain, Managing Director, SRG Housing Finance Limited. Confirms letters have been sent to everyone; if City Union Bank did not receive, requests an email and will send it again.

19. 19. Internal audit and lender data

    Yash, RevX Capital

    Question. Did the internal audit team flag anything over the last 6-12 months in line with NHB's flagging? Has there been specific communication with the bankers present on the call to give them peace of mind, and could the latest collection-efficiency/ALM numbers be shared?

    Answer, Vinod Kumar Jain, Managing Director, SRG Housing Finance Limited. On internal audit: nothing reported till the closing report comes — change is only known then. On lender communication: 'I have done some communication with everyone'. On sharing collection-efficiency/ALM: 'I have already done it with the rating agency' on the latest numbers — concludes with 'Let us see' when asked again about collection efficiency.

    Not answered directly.

20. 20. Data leak and refinancing

    Ronak Chheda, Awriga Capital

    Question. How is the data getting leaked if NHB is not officially confirming anything to the company — is this legitimate or improper sharing? And is there any indication from lenders for refinancing existing facilities going forward?

    Answer, Vinod Kumar Jain, Managing Director, SRG Housing Finance Limited. On the leak: 'no regulator — RBI or any other — ever tells or says anything like this for any company; no such information has been given by them, nor did anyone talk to them'. On refinancing: existing sanctions are already there; once the audit clears, lenders are 'ready to work in the future'.

    Not answered directly.

21. 21. Covenant breach and lender meet

    Nihar Jena, Bandhan Bank

    Question. Has there been any covenant breach due to RFA classification triggering any recall facility from any lender? And request for a lenders' meet similar to this investor meet.

    Answer, Vinod Kumar Jain, Managing Director, SRG Housing Finance Limited. Confirms no recall facility has been triggered; no single-day delay to any lender obligation including NHB; no lender has talked about a recall. Position stands on multi-year comfort. Notes request for lenders' meet and acknowledges it.

22. 22. NHB capacity and collection risk

    Avinash, ESAF Small Finance Bank

    Question. In which capacity is NHB doing the audit since regulatory authority shifted to RBI in 2019 — supervisory or lender-side? With disbursement halted, are collections at risk from staff attrition, and can the monthly collection vs obligation position be shared?

    Answer, Vinod Kumar Jain, Managing Director, SRG Housing Finance Limited. MD clarifies existing housing-loan part-disbursements continue; new business is slow and pending sanctions await red-flag removal. Strongly affirms 15-20 year lender relationships; collection is not bad and nothing adverse has happened. Asks investor to keep confidence; requests compressed answer owing to time.

    Not answered directly.

23. 23. Red flag mechanics and slowdown rationale

    Rahul Tiwari, Individual Investor

    Question. Audits happen every year — does business always slow down during audit? If the company is clean, why does the red flag require a slowdown?

    Answer, Vinod Kumar Jain, Managing Director, SRG Housing Finance Limited. MD clarifies that a 'Red Flag' classification does not mean a default — it is a temporary precautionary step used by the regulator during audits and removed on closing. Slowdown is precautionary given the current situation and availability of liquidity buffer; there is no demand shortage. Speed of business will pick up after closing.

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