Piramal Finance’s 67% profit growth needs a closer look

Piramal Finance Limited (NSE: PIRAMALFIN) reported Q2 FY27 consolidated net profit of ₹545 crore, up 67% year-on-year. Net interest income increased 35% to ₹1,530 crore. What happened? The lender's assets under management grew 24% to ₹1.13 lakh crore, while retail AUM increased 30% to ₹97,462 crore. Other important developments included: - Net interest margin expanded by 35 basis points to 6.5%. - Retail disbursements increased 34% to ₹14,646 crore. - Cost-to-income ratio improved to 52.1% from 61.2% a year earlier. - The company raised ₹3,850 crore in equity capital through a QIP and a proposed preferential warrant issue. However, loan-loss provisions and fair-value losses increased 22% year-on-year to ₹302 crore. My analysis Piramal Finance is showing encouraging progress in its transition towards a retail-led lending business. Growth in retail AUM, improving margins and a lower cost-to-income ratio point towards better operating efficiency.