Repco Home Finance Limited reported a standalone net profit of ₹114 crore for the quarter ended June 30, 2026, marking a 6% year-on-year increase from ₹108 crore in the same period last year. The housing finance company’s net interest income (NII) rose 10.2% to ₹216 crore, driven by an 8.9% expansion in its loan book to ₹15,990 crore. Total income grew 6.1% to ₹468 crore, reflecting steady demand across its retail lending portfolio despite a sequential dip in quarterly profit from ₹129 crore in Q4FY26.

The Board of Directors approved the unaudited financial results on August 11, 2026, in compliance with Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. Statutory auditors R. Subramanian and Company LLP conducted a limited review of the interim financial information under Standard on Review Engagements (SRE) 2410. The company published these results in Business Line (All India Edition) and Dinamani (Chennai Edition) on August 13, 2026, and submitted security cover and covenant compliance certificates for its listed secured debt securities as per Regulation 54(3) and Regulation 56 of the SEBI Listing Regulations.

Financial Performance Highlights

Interest income increased to ₹456.90 crore from ₹444.13 crore in the prior quarter. Fees and commission income declined to ₹5.49 crore from ₹7.21 crore. Other operating revenue more than doubled to ₹3.10 crore from ₹1.29 crore, while net gain on fair value changes rose to ₹2.21 crore from ₹0.89 crore. Dividend income remained nil for the current quarter.

Expenses totaled ₹320.16 crore, up from ₹305.87 crore in the previous quarter. Finance costs rose to ₹251.29 crore from ₹246.78 crore. Impairment on financial instruments swung to a charge of ₹9.69 crore from a reversal of ₹11.35 crore in the prior period. Employee benefits expense decreased to ₹34.22 crore from ₹44.05 crore. Depreciation and amortization increased slightly to ₹10.38 crore from ₹10.20 crore.

Asset Quality and Loan Book Growth

As of June 30, 2026, the gross NPA ratio stood at 2.7%, down from 3.3% in June 2025, while the net NPA ratio remained stable at 1.2%. The absolute GNPA decreased to ₹427 crore from ₹485 crore a year ago, though it rose sequentially from ₹405 crore in March 2026. The provision coverage ratio for Stage-3 assets was 54.5%, with total provisions for expected credit losses amounting to ₹353 crore or 2.2% of total loan assets. The capital adequacy ratio stood at 36.13%, well above the regulatory minimum of 15%.

The loan book composition showed loans to the non-salaried segment accounting for 53.5% of the outstanding, while salaried segment loans made up 46.5%. Housing loans constituted 70.8% of the portfolio, with Home Equity products comprising 29.2%. All loans disbursed by the company are retail in nature. Loan sanctions stood at ₹938 crore in Q1FY27 compared to ₹907 crore in Q1FY26, while disbursements were ₹843 crore against ₹829 crore in the prior year.

Management Commentary and Outlook

During the earnings call held on August 12, 2026, Managing Director T. Karunakaran attributed the sequential dip in disbursements to annual staff transfers and promotions conducted in April and May, which temporarily unsettled branch operations. He confirmed that operations have stabilized, with July disbursements and early August figures aligning with expectations. The company targets ₹1,200 crore to ₹1,250 crore in disbursements for Q2FY27 and reaffirmed its full-year guidance of ₹5,000 crore in disbursements and 13-14% growth in AUM.

Karunakaran highlighted that the company’s cost of funds stood at 8.3%, supported by a borrowing mix of 86% from the banking system, 6.2% from the National Housing Bank (NHB), and 4.8% from Repco Bank. The company has received a refinance support of ₹600 crore from the NHB, of which ₹106 crore was availed in the first week of August. This facility is expected to help stabilize the cost of funds despite potential spread compression.

What the Numbers Show

The reversal of deferred tax liability recognized in the prior year significantly impacted the current quarter's tax profile. The company reversed ₹14.40 crore of deferred tax expense previously recognized on special reserves created under Section 36(1)(viii) of the Income Tax Act, 1961. Management assessed that there is no intention to utilize these special reserves in the future, meaning the deferred tax liability is not capable of being reversed. This accounting treatment, approved by the Board and aligned with Ind AS 12, resulted in a lower deferred tax expense of ₹1.25 crore in the current quarter compared to a credit of ₹12.11 crore in the previous quarter, impacting the overall tax expense calculation.

Management also addressed asset quality concerns, noting that while GNPA rose sequentially to ₹427 crore from ₹405 crore, it remains significantly lower than the ₹485 crore recorded a year ago. The company has bifurcated NPAs into "soft" and "chronic" categories, allocating specific accounts to Regional Vertical Managers for focused recovery efforts. Karunakaran stated the target is to reduce NPA levels to approximately ₹400 crore by September 2026, aiming for a sub-2% GNPA ratio by March 2027.

Repco Home Finance has restructured its leadership and audit functions following a Board meeting held on August 11, 2026. The housing finance company appointed Aparna Sudip Kumar as an Additional Director in the capacity of Non-Executive & Independent Director, effective immediately. Simultaneously, the Board approved the appointment of Bakthavatsalu Kannan as a Whole-time Director and Key Managerial Personnel, with his tenure commencing on August 24, 2026. These appointments strengthen the company’s governance framework ahead of shareholder approval at the ensuing Annual General Meeting.

The Board also addressed regulatory compliance requirements stemming from its asset size. As Repco Home Finance’s assets exceeded ₹15,000 crore as of March 31, 2026, it is mandated under Reserve Bank of India (RBI) Guidelines to conduct statutory audits through a joint audit by a minimum of two firms. Consequently, the Board appointed M/s. Rajagopal & Badri Narayanan, Chartered Accountants, as Joint Statutory Auditor for a term of three consecutive years. Their tenure will commence from the conclusion of the 26th Annual General Meeting until the conclusion of the 29th Annual General Meeting, subject to shareholder approval.

In addition to board-level changes, the company appointed P.R. Durai as Chief Information Officer, classified as Senior Management. Mr. Durai, currently an Additional General Manager at promoter Repco Bank, will assume his role on August 24, 2026, for a period of three years or co-terminus with his deputation from Repco Bank. All appointments are subject to ratification by shareholders.

Key Appointments Overview

Governance and Compliance Details

The appointments were made pursuant to Regulation 30 and Regulation 51 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, read with SEBI Master Circular No. HO/49/14/14(7)2025-CFD-POD2/I/3762/2026 dated January 30, 2026. The Nomination & Remuneration Committee recommended the director appointments, while the Audit Committee recommended the appointment of the Joint Statutory Auditor.

Aparna Sudip Kumar brings over 30 years of experience in Information Technology, including leadership roles in multinational IT consulting and banking sectors. She holds a Bachelor of Science (Honours) in Electronics, a Post Graduate Diploma in Computer Applications, and a Post Graduate Programme for Senior Executives (PGP MAX-MBA) from the Indian School of Business. She is not related to any existing directors and is not debarred from holding office by SEBI or any other authority.

Bakthavatsalu Kannan, who joins from Repco Bank, holds Bachelor’s degrees in Physics, a Master’s degree in Social Work, and is a Certified Associate of the Indian Institute of Bankers. He has over 31 years of experience in the banking sector. His appointment as Whole-time Director is co-terminus with his deputation from the promoter bank.

Audit Firm Profile

M/s. Rajagopal & Badri Narayanan, established in 1981, is a firm of Chartered Accountants with Firm Registration No. 003024S. The firm has six full-time partners and approximately 35 years of audit experience. Its expertise includes internal and operational audits, taxation, business valuations, financial compliance, and due diligence reviews. The firm was selected to serve as the Joint Statutory Auditor to ensure compliance with RBI guidelines for NBFCs with asset sizes above ₹15,000 crore.