Northern Arc Capital has made the full transcript of its first quarter FY27 earnings conference call available to investors and analysts, supplementing the previously released audio recording. The call, which took place on Monday, July 27, 2026, at 18:30 IST, focused on the company’s unaudited financial results for the quarter ended June 30, 2026. The transcript is now hosted on the company’s official website, providing a permanent textual reference for stakeholders who wish to review the detailed management commentary and question-and-answer session.

The earnings discussion was led by Managing Director and Chief Executive Officer Ashish Mehrotra. He was joined by Chief Financial Officer Atul Tibrewal, Group Risk Officer & Governance Head Pardhasaradhi Rallabandi, and Head Investor Relations Chetan Parmar. The session allowed participants to review operational performance and financial metrics directly with the leadership team via an audio group conference format. The availability of both the audio recording and the written transcript fulfills the disclosure requirements for post-event accessibility under Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Previously, Northern Arc Capital had announced the schedule for this call on July 21, 2026, pursuant to Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The event was coordinated by ICICI Securities, which provided universal access numbers for participants in India, Hong Kong, Singapore, the UK, and the USA. The intimation regarding the availability of the transcript was signed by Prakash Chandra Panda, Company Secretary & Compliance Officer, on August 03, 2026. The notice was submitted to both the BSE Limited and the National Stock Exchange of India Ltd., ensuring compliance with listing obligations.

The transcript serves as a key resource for investors analyzing the company’s performance trajectory in the initial quarter of the fiscal year. It provides a verbatim record of the management's response to investor queries regarding revenue drivers, margin trends, and strategic initiatives for FY27. This comprehensive disclosure aligns with best practices for corporate transparency, allowing for deeper analysis of the company's financial health and operational outlook beyond the summary figures presented in the statutory results.

Northern Arc Capital reported a standalone net profit of ₹114 crore for the quarter ended June 30, 2026 (Q1FY27), marking a 41% year-on-year increase from ₹81 crore in Q1FY26. The Mumbai-based non-banking financial company (NBFC) delivered its strongest quarterly performance, driven by a 32% surge in net interest income (NII) to ₹394 crore and disciplined credit underwriting that reduced credit costs to 2.6%. This result underscores the company's ability to scale profitability while maintaining robust asset quality in a competitive lending landscape, with earnings per share rising to ₹7.54 from ₹6.42.

The Board of Directors approved the unaudited standalone and consolidated financial results on July 27, 2026, pursuant to Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The results were reviewed by statutory auditors M/s. Walker Chandiok & Co LLP. The company also disclosed compliance with financial covenants under its debenture trust deeds and submitted security cover certificates as required under Regulation 54(2) and 54(3). An investor presentation detailing these results was released on July 27, 2026, highlighting key operational metrics and strategic initiatives.

Financial Performance Highlights

Northern Arc Capital’s total revenue from operations stood at ₹76,749.88 lakh for the quarter, compared to ₹59,058.40 lakh in Q1FY25. Interest income grew significantly to ₹75,408.76 lakh from ₹55,793.38 lakh in the prior year period. While fee and commission income declined slightly to ₹651.24 lakh from ₹1,386.73 lakh, gains from derecognition of financial instruments contributed ₹689.88 lakh. Total expenses rose to ₹60,742.71 lakh from ₹45,471.78 lakh, primarily due to higher finance costs and impairment provisions.

The following table summarizes key financial metrics for the quarter:

Consolidated net profit attributable to owners of the holding company was ₹11,432.84 lakh (₹114.33 crore), up from ₹8,105.17 lakh in Q1FY25. Basic earnings per share stood at ₹7.54, compared to ₹6.42 in the previous year.

Asset Quality and Portfolio Growth

The NBFC’s lending assets under management (AUM) grew by 26% year-on-year to ₹16,855 crore as of June 30, 2026. Direct-to-customer (D2C) lending AUM crossed the ₹10,000 crore milestone, rising 51% to ₹10,766 crore and accounting for 64% of total lending AUM. Asset quality improved sequentially, with gross NPA declining by 20 basis points to 1.0% and net NPA falling by 15 basis points to 0.5%. The provisioning coverage ratio on Stage III assets improved to 48.5%.

Capital adequacy remained strong at 22.7%, well above regulatory requirements. Net worth increased by 15% to ₹4,056 crore. The company maintained a debt-equity ratio of 3.05 and total debts to total assets ratio of 0.72.

Strategic Developments and Risk Management

Northern Arc Capital received SEBI approvals for two new debt funds, expanding its asset management capabilities. ICRA assigned the company an 'Outstanding' ESG Impact Rating with a score of 81/100, reflecting its commitment to sustainable growth. The company reclassified ₹948.28 lakh of loan assets from amortized cost to Fair Value Through Other Comprehensive Income (FVOCI), recognizing a fair value gain of ₹50.22 lakh.

Management maintained a prudent approach to risk, recognizing an additional Expected Credit Loss (ECL) provision of ₹6,584 lakh during the quarter to account for geopolitical uncertainties and macroeconomic stress conditions affecting unsecured retail lending. This overlay provision, dynamic in nature, was reassessed based on evolving portfolio conditions. The company also transferred stressed loans worth ₹3,823.16 lakh to Asset Reconstruction Companies (ARCs) during the quarter.

Ashish Mehrotra, Managing Director & CEO, stated that the quarter marked a strong start to FY27, driven by disciplined execution and a focus on granular retail lending. He highlighted the company's diversified business model and calibrated risk approach as key factors in navigating external uncertainties while sustaining growth momentum.