Piramal Finance Q4FY26 net profit rises 390% to Rs 502 crore

MUMBAI: Piramal Finance reported a consolidated net profit of Rs 502.0 crore for the quarter ended March 31, 2026, a 390% year-on-year rise from Rs 102.0 crore, driven by expansion in the growth business, reduction in legacy assets, and improved operating efficiency.The company’s earnings were led by net interest income, which rose 41% year-on-year to Rs 1,362.0 crore in Q4FY26. Interest income increased 28% to Rs 3,038.0 crore, supported by assets under management crossing Rs 1,01,230.0 crore, up 25% year-on-year. Within this, the growth AUM rose 33% and accounted for 97% of the total portfolio. Interest expense increased 18% to Rs 1,676.0 crore, while the cost of borrowings declined to 8.8% from 9.1% a year earlier. Net interest margin expanded by 14 basis points to 6.5%.Non-interest income declined 49% year-on-year to Rs 194.0 crore in the quarter, weighed by a 39% fall in fee and commission income and a 57% decline in other income. Total income, comprising net interest income and non-interest income, rose 16% to Rs 1,556.0 crore. Operating profit increased 25% to Rs 694.0 crore, supported by lower operating costs, with the retail operating expense-to-AUM ratio declining by 74 basis points to 3.6%.Asset quality improved as the company shifted towards retail lending, which accounted for 85% of total AUM. The gross stage 3 ratio declined to 2.3% from 2.8% a year earlier, while the net stage 3 ratio stood at 1.6%. Loan loss provisions rose to Rs 1,787.0 crore from Rs 531.0 crore, reflecting higher provisioning on legacy assets. Profit was supported by exceptional gains of Rs 1,590.0 crore, including Rs 1,326.0 crore from the Piramal Imaging sale and Rs 263.0 crore from a stake sale in Shriram Life Insurance.For the full year ended March 31, 2026, net profit rose 210% year-on-year to Rs 1,506.0 crore.As of March 31, 2026, total AUM stood at Rs 1,01,230.0 crore, up 25%, while retail AUM rose 33% to Rs 85,885.0 crore. The capital adequacy ratio stood at 19.8%. Cost of funds was 6.4% of AUM. The provision coverage ratio was 29.6% overall and 32.8% for the growth business. Leverage, measured as AUM to equity, stood at 3.6 times.The company guided for around 25% AUM growth and a 50% increase in consolidated profit for FY27, with a target return on average AUM of around 2.5%.