Poonawalla Fincorp reported a sharp increase in profitability for the September quarter of FY27, with consolidated profit after tax rising 405.2% year-on-year to ₹374.85 crore. The non-banking financial company (NBFC) benefited from strong growth in its loan portfolio, higher interest and fee income, improved margins and lower credit costs, while its assets under management (AUM) expanded to ₹74,008 crore.
The results for the quarter ended September 30, 2026, also showed that the lender’s newer businesses are becoming a more meaningful part of its operations. Revenue from operations increased 70.2% year-on-year to ₹2,624.50 crore, while net interest income, including fees and other income, rose 75.6% to ₹1,589 crore. Improvements in asset quality and the expansion of products such as gold loans, commercial vehicle loans and education loans further shaped the company’s performance.
Poonawalla Fincorp Q2 FY27 Results: Key Numbers
Poonawalla Fincorp’s September-quarter performance improved across several major financial indicators. Profit increased both year-on-year and sequentially, while the expansion of its loan portfolio supported growth in revenue and interest-related income.
Q2 FY27 Financial Performance
| Financial metric | Q2 FY27 | Q2 FY26 | Year-on-year change |
|---|---|---|---|
| Consolidated profit after tax | ₹374.85 crore | ₹74.20 crore | +405.2% |
| Revenue from operations | ₹2,624.50 crore | ₹1,542.30 crore | +70.2% |
| Net interest income, including fees and other income | ₹1,589 crore | ₹904 crore approximately | +75.6% |
| Assets under management | ₹74,008 crore | ₹47,700 crore approximately | +55.1% |
| Gross NPA ratio | 1.20% | 1.59% | Improved |
| Net NPA ratio | 0.61% | Not directly comparable here | — |
Sources: Fortune India, The Economic Times and company results. Figures are rounded where appropriate.
The profit increase is particularly significant because the company earned ₹74.20 crore in the corresponding quarter of the previous financial year. However, percentage growth is amplified by the relatively low comparison base. The absolute profit figure and the sustainability of earnings growth will therefore remain important measures in subsequent quarters.
Profit Rises 21.8% Sequentially
Poonawalla Fincorp’s consolidated profit after tax increased 21.8% from ₹307.71 crore in the June 2026 quarter to ₹374.85 crore in Q2 FY27.
Revenue from operations rose 12.6% sequentially from ₹2,330.22 crore. Net interest income, including fees and other income, increased 12.3% from the preceding quarter.
The sequential improvement indicates that the company’s earnings momentum continued beyond the year-on-year comparison. Higher income from lending, growth in newer products and an improvement in margins contributed to the performance.
The company also reported pre-provision operating profit of ₹877 crore, up 11.8% quarter-on-quarter. This measure indicates operating earnings before provisions for potential loan losses and taxes.
For an NBFC, the combination of income growth and controlled credit costs is important because loan defaults can erode the benefits of a rapidly expanding portfolio.
AUM Grows 55% to ₹74,008 Crore
Poonawalla Fincorp’s assets under management increased 55.1% year-on-year to ₹74,008 crore as of September 30, 2026. AUM grew 10.4% sequentially from the June quarter.
AUM measures the loans and other financial assets managed by the lender. Growth can support future interest income, although the eventual benefit depends on loan pricing, funding costs, borrower repayments and asset quality.
The company has been expanding beyond its established lending activities into a wider range of consumer and business-financing products. Its portfolio includes personal loans, gold loans, education loans, consumer durable financing, commercial vehicle loans and shopkeeper loans.
This broader product mix can create opportunities to reach different borrower segments. It can also help diversify income sources, although each lending category carries its own credit risks and operating requirements.
New Lending Businesses Contribute 28% of Disbursements
Poonawalla Fincorp said its newer businesses accounted for 28% of total disbursements during Q2 FY27, with disbursements exceeding ₹4,400 crore.
These businesses include Prime personal loans, gold loans, education loans, consumer durable loans, commercial vehicle financing and shopkeeper loans.
The company’s expansion in gold loans has included an increase in its branch network to 550 branches. It also reported a monthly disbursement run rate of approximately ₹127 crore for commercial vehicle loans.
In consumer durable financing, the company has expanded its network to around 20,000 dealers across 360 locations. Its commercial vehicle business has also grown to more than 1,250 channel partners, according to management commentary reported by The Economic Times.
The contribution from newer products suggests that the company is building additional lending channels alongside its established businesses. The longer-term performance of these products will depend on borrower demand, acquisition costs, repayment behaviour and the company’s ability to manage risk as the portfolio expands.
Margins Improve as Credit Costs Decline
Poonawalla Fincorp’s net interest margin, including fees and other income, increased to 9.26% in Q2 FY27 from 9.10% in the June quarter.
The margin improvement suggests that the company is generating more income relative to its assets, supported by changes in loan pricing and the contribution of fee-based businesses. Management also said yields on new disbursements improved by approximately 20 basis points during the September quarter, following a roughly 50-basis-point increase in the preceding quarter.
At the same time, credit costs as a percentage of average AUM declined to 2.19% from 2.40% in Q1 FY27. Lower credit costs can support profitability because the lender needs to set aside less money relative to its managed assets for potential loan losses.
However, margins and credit costs can change as interest rates, competition and borrower repayment patterns evolve. Maintaining the current level of profitability while continuing to expand the loan book will remain a key operating challenge.
Asset Quality Shows Improvement
The company’s asset-quality indicators improved during the quarter.
| Asset-quality metric | Q2 FY27 | Q1 FY27 |
|---|---|---|
| Gross non-performing assets | 1.20% | 1.37% |
| Net non-performing assets | 0.61% | 0.70% |
| Stage 1 assets as a share of on-book assets | 97.9% | 97.6% |
| Credit cost as a share of average AUM | 2.19% | 2.40% |
Gross non-performing assets (GNPA) represent loans classified as non-performing before adjusting for provisions. Net non-performing assets (NNPA) account for provisions already made against such assets.
The decline in both gross and net NPA ratios indicates an improvement in reported asset quality compared with the preceding quarter. The increase in the share of Stage 1 assets also suggests that a larger proportion of the on-book portfolio remained in the earliest risk category.
These indicators do not eliminate credit risk. As the company expands into new products and borrower segments, its ability to maintain underwriting standards and collection efficiency will be important.
Capital Position and AI Investments
Poonawalla Fincorp reported a capital adequacy ratio of 18.68% as of September 30, 2026, including a Tier-I capital ratio of 17.15%. Its liquidity buffer stood at ₹6,526 crore.
Capital adequacy measures the lender’s capital relative to its risk-weighted assets and is an important indicator of its ability to absorb potential losses. Liquidity, meanwhile, helps the company meet its near-term financial obligations and manage fluctuations in funding needs.
The company also reported adding 42 AI projects during the quarter, taking its total to 143 projects, of which 84 had been implemented. Management has identified proprietary AI capabilities as one factor supporting operational improvements.
The results do not quantify the precise contribution of these AI projects to profit growth. Their impact will depend on whether they improve processes such as loan origination, customer servicing, risk assessment and collections at scale.
The Bigger Picture
Poonawalla Fincorp’s Q2 FY27 results show strong growth in earnings and AUM, alongside improvements in margins and reported asset quality. The expansion of newer lending businesses is also changing the company’s product mix and broadening its potential sources of income.
The main question is whether the lender can sustain this pace of growth while controlling funding costs and credit losses. Rapid loan expansion can support revenue, but long-term performance depends on the quality of new loans, efficient operations and disciplined capital management.
Looking Ahead
Investors will watch whether Poonawalla Fincorp can maintain its sequential earnings momentum, expand its newer lending businesses and preserve asset quality as the portfolio grows. Changes in net interest margins, credit costs, funding expenses and capital adequacy will be important indicators of the durability of its performance.
The September-quarter results provide evidence of stronger earnings and a larger lending portfolio, but one quarter alone cannot establish a long-term trend. Future results will show whether the company can convert its expansion into consistent profitability while managing the risks associated with a growing NBFC loan book.
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