Poonawalla Fincorp reported a significant increase in net profit to ₹375 crore for the second quarter of financial year 2027, driven by a rise in net interest income and strong growth in consumer and MSME lending.
Poonawalla Fincorp Limited posted a net profit of ₹375 crore for the quarter ended September 30, 2026, marking a substantial jump from ₹74 crore in the same period a year earlier. The non-deposit-taking non-banking financial company reported robust momentum across core and newly incubated retail lending verticals, following board approval of the unaudited financial statements on October 9, 2026.
Net Interest Income and Asset Expansion at Poonawalla Fincorp
The sharp rise in profitability rested on a 75.7% year-on-year increase in net interest income, which reached ₹1,589 crore compared to ₹905 crore in the year-ago quarter. Quarterly revenue climbed significantly to ₹2,625 crore, reflecting accelerated top-line expansion in retail financing.
Assets under management expanded 55.1% to stand at ₹74,008 crore as of September-end 2026, up from ₹47,701 crore a year earlier. New products contributed 18% to the total AUM, while the secured-to-unsecured on-book mix settled at 52:48. Managing Director and CEO Arvind Kapil highlighted the dual focus on volume and yield during the earnings release.
“We have delivered disciplined AUM expansion while enriching total realisations via NIM and fee income optimisation, demonstrating strong pricing power across core and newly incubated verticals. Concurrently, continuous asset quality refinement has driven credit costs lower from an already formidable baseline, translating directly into a structural lift in our Return on Assets (RoA).”
Arvind Kapil, Managing Director and CEO, Poonawalla Fincorp
The retail-focused business model continued to benefit from steady underlying demand across personal loans, gold loans, education loans, commercial vehicles, and consumer durables. Pre-provision operating profit expanded by 11.8% sequentially during the period.
Asset Health Strengthens as Interest Margins Rise
Underlying asset health strengthened alongside portfolio growth. Gross non-performing assets improved to 1.20% of gross advances at the end of September 2026, compared to 1.59% a year prior. Net non-performing assets similarly tightened to 0.61% of net advances against 0.81% in the corresponding quarter of the previous financial year.
The Net Interest Margin, inclusive of fees and other income, rose to 9.26% from 8.40% in Q2FY26. Return on assets moved up to 2.18%, reflecting a 20-basis-point improvement sequentially and a 149-basis-point increase year-on-year. The capital adequacy ratio stood at 18.68%, with Tier-1 capital at 17.15%, maintaining a comfortable buffer above the regulatory threshold of 15% to support future lending expansion.
During the quarter, the cost of borrowing increased slightly to 7.76%, compared with 7.69% in the year-ago quarter. The company reported no accelerated write-offs, while maintaining a debt-to-equity ratio of 4.30 times following capital raises.
AI Projects and Digital Tools Drive Operating Momentum
Management attributed part of its operating momentum to front-loaded investments in digital tools, collections capacity, and distribution infrastructure. The company added 42 new artificial intelligence projects during the quarter, bringing its total to 143 AI initiatives, of which 84 are operational.
Technological deployments expanded to include automated systems and an agentic platform designated as MyBot, which transitioned from a knowledge retrieval tool to an integrated utility capable of executing operational actions.
Following the second-quarter financial disclosures, shares of Poonawalla Fincorp Ltd closed higher on the BSE at ₹448.00, marking a gain of ₹9.80 or 2.24% for the trading session.
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