IndoStar Capital Finance Reports No Deviation in Warrant Proceeds Utilization
IndoStar Capital Finance confirmed proper utilization of proceeds from its preferential warrant issues. The company allocated 80% of funds for growth objectives, surpassing the minimum 75% requirement. Q2 FY26 results show improved net revenue and pre-provision operating profit, despite a decline in profit after tax. The company reduced its weighted cost of funds, improved capital adequacy ratio, and decreased leverage. Several key management appointments were announced to support growth objectives.
*this image is generated using AI for illustrative purposes only.
IndoStar Capital Finance Limited , a middle-layered non-banking finance company (NBFC) registered with the Reserve Bank of India, has confirmed that the proceeds from its preferential issue of warrants were utilized as per the stated purposes during the quarter ended September 30, 2025. The company reported no deviation in fund utilization across two warrant allotments.
Warrant Allotments and Fund Utilization
IndoStar made two separate warrant allotments:
| Date | Number of Warrants | Price per Warrant | Total Consideration |
|---|---|---|---|
| May 26, 2024 | 10,869,565 | 184.00 | 1,999,999,960.00 |
| November 26, 2024 | 13,949,323 | 184.00 | 2,566,675,432.00 |
The funds were allocated for the following purposes:
Growth Objectives: At least 75% of the issue proceeds were designated to meet funding requirements and growth objectives, including augmenting the company's capital base and onward lending for commercial vehicle financing, housing finance, SME financing, and retail lending businesses.
General Corporate Purposes: Up to 25% of the issue proceeds were allocated for general corporate purposes, including meeting ongoing corporate exigencies and contingencies.
Compliance with Stated Objectives
IndoStar reported that it utilized 80% of the total consideration for growth objectives, which aligns with the disclosed minimum requirement of 75%. This utilization is in line with the company's original disclosures and demonstrates adherence to its stated funding allocation strategy.
Financial Performance Highlights
For the quarter ended September 30, 2025, IndoStar reported:
| Metric | Q2 FY26 | Q-o-Q Change | Y-o-Y Change |
|---|---|---|---|
| AUM | 7,564.00 crore | - | - |
| Disbursements | 927.00 crore | 8.14% | - |
| Net Revenue from Operations | 190.10 crore | 20.20% | 14.60% |
| Operating Expenses | 121.00 crore | -13.10% | -6.00% |
| Pre-provision Operating Profit | 69.10 crore | 265.60% | 85.80% |
| Profit After Tax | 10.50 crore | -98.00% | -41.70% |
The company's Gross Stage 3 stood at 3.04%, with Net Stage 3 at 1.13% for Q1 FY26.
Other Notable Developments
- The company reduced its weighted cost of funds to 10.17% in Q2 FY26, down 67 basis points from 10.84% in Q2 FY25.
- Capital Adequacy Ratio (CAR) improved to 37.2% from 32.7% in the previous quarter.
- Leverage (Debt-to-Equity ratio) decreased to 1.4x from 1.73x in the previous quarter.
Management Changes
IndoStar announced several key appointments:
- Mr. Vishal Goenka as Non-Executive and Non-Independent Director (effective August 28, 2025)
- Mr. Amit Kumar Khan as Chief Operating Officer (COO) for M-LAP (effective August 14, 2025)
- Ms. Jasmine Bawa as Chief Human Resources Officer (CHRO) (effective October 1, 2025)
- Mr. Binoy Parikh as Chief Compliance Officer (effective October 13, 2025)
These appointments are expected to strengthen the company's management team and support its growth objectives.
IndoStar Capital Finance continues to focus on its core segments of Vehicle Finance (VF) and Micro Loans Against Property (M-LAP), leveraging its position as a professionally managed and institutionally owned entity with Brookfield & Everstone as co-promoters.
Historical Stock Returns for IndoStar Capital Finance
| 1 Day | 5 Days | 1 Month | 6 Months | 1 Year | 5 Years |
|---|---|---|---|---|---|
| +5.49% | +5.45% | +0.12% | -11.75% | -5.96% | -12.34% |
16
