New Delhi, June 11 -- Housing finance companies (HFCs) have emerged stronger after navigating multiple challenges during FY26, with asset quality improving sharply, loan growth picking up, and profitability remaining resilient, according to a sector review report by Equirus Securities.

The brokerage said the housing finance sector witnessed a broad-based recovery in the fourth quarter of FY26, supported by better collections, lower credit costs and healthy disbursement growth.

"For HFCs, 4QFY26 was marked by (1) sharp asset quality recovery, (2) healthy disbursement and AUM growth, (3) range-bound spreads/NIMs, (4) rapid branch expansion, (5) lower credit costs, and (6) strong profitability," the report said.

According to the report, t...