PNB Housing Finance Limited has reported a strong financial performance for the second quarter of fiscal year 2025-26 (Q2 FY26), with a 23.8% year-on-year increase in net profit to ₹582.00 crore. The company's focus on retail growth and expansion in the affordable housing segment has contributed to its robust results.

Key Financial Highlights

• Net profit increased by 23.8% YoY and 9.0% QoQ to ₹582.00 crore
• Net Interest Income grew by 14.4% YoY to ₹765.00 crore
• Pre-provision Operating profit grew by 15.6% YoY to ₹646.00 crore
• Gross Non-Performing Assets (GNPA) improved to 1.04% from 1.24% a year ago

Loan Growth and Asset Quality

PNB Housing Finance's retail loan asset grew by 17% YoY to ₹79,439.00 crore as of September 30, 2025, representing 99.6% of the total loan asset. The company's focus on the affordable and emerging market segments has paid off, with this portfolio growing by 34% YoY and now contributing 38% to the retail loan asset.

Jatul Anand, Executive Director of PNB Housing Finance, stated, "Our strategic focus continues to drive profitable growth. The Retail Asset grew by 17% YoY for FY25 reaching to ₹79,439.00 crore as on 30th Sept 2025. We disbursed almost ₹6,000.00 crore delivering a sequential growth of 20% vs Q1 FY26."

The company's asset quality has shown improvement, with Gross NPA decreasing to 1.04% as of September 30, 2025, compared to 1.24% a year ago. Net NPA stood at 0.69%.

Segment Performance

The affordable and emerging market segments continue to contribute 50% of the total retail disbursements, aligning with the company's strategic focus.

Financial Metrics

• Return on Assets (ROA) improved to 2.73% in Q2 FY26 (annualized)
• Net Interest Margin (NIM) stood at 3.67% in Q2 FY26
• Capital Adequacy Ratio remained strong at 29.80% as of September 30, 2025

Future Outlook and Management Updates

PNB Housing Finance aims to accelerate retail growth and expand its footprint in the affordable and emerging markets segments. The company expects loan growth of 17-18% for the current fiscal year, with net interest margin forecasted to remain between 3.6-3.7% in the second half.

Anand added, "Our goal is to enhance customer experience, strengthen risk frameworks, and maintain industry-leading asset quality while delivering sustainable returns. With a strong leadership team and a culture that never loses momentum, we are confident of creating long-term value for all stakeholders."

The company plans to expand to 250 branches in affordable housing by year-end and targets a portfolio composition by FY27 of 15% affordable housing, 65% prime, and the remaining in the emerging sector.

In a recent development, PNB Housing Finance announced that its Board-led CEO selection process is currently in progress, with a formal disclosure expected soon. The senior leadership team is maintaining business continuity and steady performance during this interim period. Management has confirmed that the company's core mortgage strategy will remain unchanged under the new CEO, with no significant strategic modifications anticipated.

Following the quarterly review, Motilal Oswal has increased the target price for PNB Housing Finance stock, reflecting confidence in the company's performance and future prospects.

The company's focus on maintaining a balanced growth strategy, improving asset quality, and expanding in high-yield segments positions it well for continued success in the competitive housing finance market.

PNB Housing Finance Limited , one of India's leading housing finance companies, has unveiled ambitious strategic targets for fiscal year 2027 (FY27) while reporting robust financial results for the second quarter of FY26. The company aims to achieve a loan book of ₹1.25 lakh crore and a return on equity of 18% by FY27, signaling a strong growth trajectory and focus on profitability.

Strategic Targets and Growth Focus

PNB Housing Finance has outlined a clear strategy to drive growth, with a particular emphasis on its affordable and emerging markets segments. The company plans to grow these segments at a 20% compound annual growth rate (CAGR), underlining its commitment to expanding its presence in high-potential markets.

Q2 FY26 Financial Highlights

The company's financial performance for Q2 FY26 reflects its strong market position and effective strategy execution:

• Net profit increased by 23.8% year-over-year to ₹582.00 crore
• Net Interest Income grew by 14.4% year-over-year to ₹765.00 crore
• Retail Loan Asset grew by 17% year-over-year to ₹79,439.00 crore
• Gross Non-Performing Assets (GNPA) improved to 1.04% from 1.24% in the previous year

Focus on Affordable and Emerging Markets

PNB Housing Finance's strategic focus on affordable and emerging markets segments is yielding positive results:

• The Affordable and Emerging Markets segment grew by 34% year-over-year
• This segment now contributes 38% to the Retail Loan Asset
• Disbursements in these segments grew by 30.7% and 23.0% year-over-year, respectively

Asset Quality and Profitability

The company has maintained a strong focus on asset quality while improving profitability:

• Return on Assets (ROA) improved to 2.73% in Q2 FY26 (annualized)
• Capital Risk Adequacy Ratio stood at 29.80% as of September 30, 2025
• The company recovered ₹59.00 crore from the total written-off pool in Q2 FY26

Management Commentary

Commenting on the performance, Mr. Jatul Anand, Executive Director, said, "Despite the challenges posed by leadership transitions, we have delivered a strong and resilient performance across all key metrics this quarter. Our strategic focus continues to drive profitable growth. The Retail Asset grew by 17% YoY for FY25 reaching to ₹79,439 crore as on 30th Sept 2025."

He further added, "Looking ahead to FY26, we are focused on accelerating retail growth and expanding our Affordable and Emerging Markets segment footprint. Our goal is to enhance customer experience, strengthen risk frameworks, and maintain industry-leading asset quality while delivering sustainable returns."

Outlook

PNB Housing Finance's strategic targets for FY27, coupled with its strong Q2 FY26 performance, indicate a positive outlook for the company. The focus on affordable and emerging markets segments, along with efforts to maintain asset quality and improve profitability, positions the company well for sustainable growth in the coming years.

As the company continues to execute its growth strategy and navigate the dynamic housing finance landscape, investors and stakeholders will be keenly watching its progress towards achieving the ambitious FY27 targets.

Note: All financial figures are based on consolidated results as per Indian Accounting Standards (IndAS).