Poonawalla Fincorp profit rises fivefold in Q2

Research Analyst: UJVIN NEVATIA (PROPRIETOR: NEVAT INVESTMENTS) | SEBI Registration No.: INH100009628 Poonawalla Fincorp Limited (

) reported a 405% year-on-year increase in net profit to ₹375 crore in Q2 FY27. Total income rose 70% to ₹2,625 crore, supported by growth in its lending business. What happened? Assets under management (AUM) grew 55% year on year to ₹74,008 crore. Net interest income, including fees and other income, rose 12.3% sequentially to ₹1,589 crore. Net interest margin improved to 9.26% from 9.10% in the previous quarter. Gross NPAs declined to 1.20% from 1.37%, while net NPAs fell to 0.61% from 0.70%. Credit costs also eased to 2.19% from 2.40%. Why does it matter? Higher AUM and income indicate business expansion, while improving asset quality supports earnings. However, rapid lending growth must be balanced against credit risk and funding costs. My view The profit increase is significant, but the low base in the previous year matters when interpreting growth. Sustaining earnings will depend on loan quality, margins and whether newer lending businesses remain profitable as they scale. What I am watching next I would track AUM growth, net interest margins, borrowing costs and credit costs. The key question is whether rapid expansion can continue without weakening underwriting standards. No Recommendations Source: NDTV Profit Disclosure: I, my entity, associates or relatives do not have any holding, position or other material interest in Poonawalla Fincorp Limited.