Non-banking lender Piramal Finance announced on Monday a significant increase in net profit by 67% compared to the previous year, reaching ₹545 crore for the September quarter. This growth was driven by an increase in core income and improved costs.
The company's core net interest income increased by 35%, amounting to ₹1,530 crore. This resulted from a 24% growth in assets under management and an expansion of the net interest margin to 6.5%. Furthermore, the cost-to-income ratio sharply improved, declining to 52.1% from 61.2% in the reported quarter, which positively impacted the final result.
Managing Director and CEO Jairam Sridharan expressed confidence in the company's unique position in the NBFC sector, noting that it does not see a threat to margins even amid rising interest rates. He stated that the company could increase its NIM by 0.20% over the next year.
Responding to the question of how this is possible despite rate hikes, which increase borrowing costs for NBFCs, Sridharan explained that the recent rating upgrade will help reduce the cost of borrowings over the next two to three years and expand margins.
Sridharan also noted that the growth in assets under management could have been higher, but it was constrained due to high levels of early repayments observed. He reported that about 70% of new loans disbursed were repaid within the quarter. The trend of early repayment is more pronounced in the wholesale client segment, with the real estate sector showing the highest demand for debt early repayment in this segment.
He clarified that the growth in assets under management in the real estate sector during the quarter was about 7%, but could have reached 25% without early repayments. Regarding asset quality, Sridharan emphasized that the company has not faced stress in any segment, despite concerns about the impact of the Middle East crisis on small business lending and the influence of El Niño on the agricultural sector.
Nevertheless, he reiterated that loans issued in South India to IT sector salaried employees continue to show signs of strain, and the company is cautious in issuing such credits. The non-performing asset ratio remained stable at 2.4% as of September 2026.
Meanwhile, the company announced the appointment of former SBI Chairman Dinesh Kumar Khara as an independent director for the next five years. Piramal Finance shares closed on the BSE on Monday at ₹1,948.05 per share, down by 0.08%.