Piramal Finance net profit up 67% YoY to ₹461 crore in Q1FY27
- Consolidated net profit rose 67% YoY to ₹461 crore in Q1FY27
- Total AUM expanded 25% YoY to ₹1,06,940 crore, with Retail AUM up 32%
- Net Interest Income increased 43% YoY to ₹1,442 crore
- Cost-to-income ratio improved to 52.5% from 65.6% in Q1FY26
- GNPA ratio declined to 2.4% from 2.8% in the previous year
*this image is generated using AI for illustrative purposes only.
Piramal Finance Limited reported a 67% year-on-year increase in consolidated net profit to ₹461 crore for the first quarter of FY27. The growth was underpinned by a 25% YoY expansion in total Assets Under Management (AUM) to ₹1,06,940 crore, alongside significant improvements in operating leverage and asset quality.
The company’s retail segment continued to drive momentum, with Retail AUM growing 32% YoY to ₹91,249 crore. This expansion contributed to a 43% YoY rise in Net Interest Income (NII) to ₹1,442 crore. The cost-to-income ratio for the company improved substantially to 52.5% from 65.6% in the corresponding quarter last year, reflecting enhanced operational efficiency.
Financial performance highlights
The consolidated income statement reflects robust top-line growth and margin expansion. Interest income rose 27% YoY to ₹3,179 crore, while interest expenses increased at a slower pace of 16% YoY to ₹1,736 crore. This spread improvement boosted the Pre-Provision Operating Profit (PPOP) by 89% YoY to ₹804 crore.
| Metric | Q1FY27 | Q1FY26 | Change |
|---|---|---|---|
| Total Income | ₹1,693 crore | ₹1,237 crore | +37% |
| Net Interest Income | ₹1,442 crore | ₹1,010 crore | +43% |
| PPOP | ₹804 crore | ₹425 crore | +89% |
| Net Profit | ₹461 crore | ₹276 crore | +67% |
Segment analysis
Retail lending remains the primary engine of growth, accounting for 85% of the total AUM mix. The wholesale lending book grew 27% YoY to ₹13,238 crore, with disbursements rising 13% YoY to ₹2,604 crore. The portfolio Effective Interest Rate (EIR) for wholesale stood at 14.2%.
Asset quality metrics showed stability and improvement. The Gross Non-Performing Assets (GNPA) ratio declined to 2.4% from 2.8% in Q1FY26. Retail 90+ DPD remained stable at 0.7%, while wholesale Stage 2+3 assets were maintained below 0.2%.
What the numbers show
A key observation from the data is the convergence of the Growth business profitability with consolidated results. The Growth business PBT of ₹470 crore is nearly identical to the consolidated PAT of ₹461 crore, indicating that the legacy book’s drag on profits has significantly diminished. Legacy AUM now constitutes only ~2% of total AUM, down from 66% in FY22. Furthermore, the Return on Average AUM (RoAUM) for the growth business improved to 1.9% from 1.5% in Q1FY26, signaling better capital efficiency as the scale increases.
Historical Stock Returns for Piramal Finance
| 1 Day | 5 Days | 1 Month | 6 Months | 1 Year | 5 Years |
|---|---|---|---|---|---|
| +0.43% | -0.37% | +1.62% | +20.06% | +67.51% | +67.51% |
How will the near-complete elimination of legacy book drag influence Piramal Finance's capital allocation strategy and dividend policy in upcoming quarters?
What specific regulatory or macroeconomic headwinds could challenge the sustainability of the 32% YoY growth in the retail lending segment?
Given the improved operating leverage, what are management's targets for further reducing the cost-to-income ratio toward peer benchmarks?
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