Sangam Finserv reported a net profit of ₹9.89 crore for the first quarter of FY26 (Q1FY26), a sharp 132% rise compared to ₹4.26 crore in Q1FY25. The company’s total revenue from operations surged 103% year-on-year to ₹14.94 crore, driven largely by non-operating gains rather than core interest income. This performance signals a strong start to the fiscal year, with earnings per share (EPS) more than doubling to ₹2.12 from ₹0.91 in the previous year’s corresponding period.

The Board of Directors approved the unaudited standalone financial results on August 10, 2026. The figures were prepared in accordance with Ind AS 34 and reviewed by the statutory auditors, O P Dad & Co., pursuant to Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The company operates solely in the finance and investment segment, meaning segment reporting under Ind AS 108 is not applicable.

Financial Performance Breakdown

Revenue composition highlights the volatility introduced by fair value adjustments. While interest income remained stable at ₹4.39 crore, a slight increase from ₹4.38 crore in Q1FY25, fees and commission income grew 22% to ₹38.45 lakh. The most significant contributor to the revenue surge was the net gain on fair value changes, which stood at ₹10.17 crore in Q1FY26, compared to ₹26.53 lakh in the same period last year. In contrast, the fourth quarter of FY25 saw a loss of ₹58.17 lakh in this category.

Expenses rose 51% year-on-year to ₹28.37 crore, primarily due to higher finance expenses (₹11.97 crore vs ₹71.04 lakh) and increased impairment on financial instruments (₹26.96 lakh vs ₹10.73 lakh). Employee benefits expense also increased by 17% to ₹71.45 lakh. Despite the rise in costs, profit before tax nearly doubled to ₹12.11 crore.

What the Numbers Show

The dramatic improvement in profitability is heavily skewed toward market-driven gains rather than operational efficiency. The net gain on fair value changes accounted for approximately 68% of total revenue in Q1FY26, compared to just 36% in Q1FY25. This indicates that the company’s bottom line remains sensitive to market fluctuations in its investment portfolio. While interest income—the core business metric—showed negligible growth, the surge in fair value gains masked underlying stability in fee income and interest generation. Investors should monitor whether these fair value gains are sustainable or cyclical in nature.

Tax expenses for the quarter were ₹22.11 crore, comprising current tax of ₹55.49 lakh and deferred tax of ₹165.65 lakh. The effective tax rate appears elevated due to the high proportion of taxable capital gains included in the profit before tax figure. Other comprehensive income remained nil for the quarter.

Sangam Finserv Limited announced its audited standalone financial results for the quarter and year ended March 31, 2026. The Board of Directors approved the results during a meeting held on May 13, 2026. The company has submitted the newspaper clippings of these audited financial results to the stock exchanges, confirming publication in Business Standard and Parthakal on May 14, 2026. The auditor's report carries an unmodified opinion, confirming the results present a true and fair view in conformity with applicable Indian Accounting Standards (Ind AS).

Annual Financial Performance

For the financial year ended March 31, 2026, Sangam Finserv reported a significant decline in profitability. Total income stood at Rs 1,562.56 lakh, down from Rs 1,701.48 lakh in the previous year. Net profit for the year fell sharply to Rs 325.76 lakh from Rs 659.72 lakh in FY25. The decline was driven by a net loss on fair value changes of Rs 285.81 lakh against Rs 158.44 lakh in the prior year, alongside higher finance expenses of Rs 332.18 lakh compared to Rs 239.09 lakh previously. Total expenses rose to Rs 1,066.95 lakh from Rs 781.16 lakh, while profit before tax declined to Rs 495.61 lakh from Rs 920.32 lakh.

Quarterly Performance

For the quarter ended March 31, 2026, the company reported a net loss of Rs 547.98 lakh, compared to a net loss of Rs 170.77 lakh in the corresponding quarter of the previous year. Total income for the quarter was negative at Rs (98.28) lakh, primarily due to a net loss on fair value changes of Rs (581.68) lakh. Total expenses for the quarter stood at Rs 355.71 lakh, resulting in a loss before tax of Rs (453.99) lakh.

Balance Sheet Highlights

As of March 31, 2026, total assets grew to Rs 19,142.46 lakh from Rs 16,159.24 lakh in the previous year, reflecting a significant increase in investments to Rs 7,714.08 lakh from Rs 3,637.11 lakh. However, loans declined to Rs 9,708.44 lakh from Rs 10,719.40 lakh. On the liabilities side, borrowings rose substantially to Rs 5,397.90 lakh from Rs 2,676.25 lakh. Equity share capital remained unchanged at Rs 4,661.28 lakh, while other equity increased to Rs 8,978.94 lakh from Rs 8,658.88 lakh.

Cash Flow Summary

The company generated net cash from operating activities of Rs 1,529.36 lakh for the year ended March 31, 2026, compared to Rs 2,881.38 lakh in the previous year. Cash used in investing activities stood at Rs (4,253.32) lakh, primarily on account of investment purchases of Rs (4,236.10) lakh. Financing activities contributed Rs 2,721.65 lakh, driven by an increase in borrowings of Rs 2,721.65 lakh. As a result, cash and cash equivalents at the end of the year stood at Rs 479.26 lakh, compared to Rs 481.56 lakh at the beginning of the year.

Auditor Appointments

The board approved the re-appointment of M/s O. P. Dad & Co., Chartered Accountants (Firm Registration No. 002330C), as Statutory Auditors for a second term of five consecutive years from FY 2026-27 to FY 2030-31, subject to shareholder approval at the ensuing Annual General Meeting. The firm will hold office from the conclusion of the 43rd Annual General Meeting until the conclusion of the 48th Annual General Meeting. Additionally, M/s NVS & Co., Chartered Accountants (FRN: 132180W), were re-appointed as Internal Auditors for the financial year 2026-27.