PNB Housing Finance Limited has delivered strong financial performance in the third quarter of FY26, with consolidated net profit after tax reaching ₹520.35 crores, marking a 7.67% year-on-year growth from ₹483.27 crores in Q3 FY25. The housing finance company's Board of Directors approved these unaudited financial results on January 21, 2026, following comprehensive review by the Audit Committee and joint statutory auditors.

Quarterly Financial Performance

The company's Q3 FY26 results demonstrate solid operational strength across key metrics. Total revenue from operations increased to ₹2,119.02 crores compared to ₹1,941.76 crores in the corresponding quarter of the previous year.

Interest income, which forms the backbone of the company's revenue, grew by 9.25% to ₹2,019.39 crores from ₹1,848.43 crores in Q3 FY25. Fees and commission income also showed positive momentum, increasing to ₹94.57 crores from ₹88.12 crores year-on-year.

Nine-Month Performance Highlights

The company's nine-month performance for FY26 has been particularly impressive, showcasing sustained growth momentum across all major financial parameters.

For the nine months ended December 31, 2025, net profit after tax reached ₹1,635.44 crores, representing an 18.01% increase from ₹1,385.76 crores in the corresponding period of FY25. This strong performance reflects the company's effective business strategy and operational efficiency.

Operational Efficiency and Cost Management

The company maintained disciplined cost management while investing in growth. Finance costs for Q3 FY26 were ₹1,252.82 crores compared to ₹1,157.92 crores in Q3 FY25. Notably, the company reported a net reversal in impairment on financial instruments of ₹40.53 crores, indicating improved asset quality.

Employee benefits expenses increased to ₹133.87 crores from ₹98.29 crores in the previous year quarter, reflecting the company's continued investment in human resources and business expansion.

Earnings Per Share and Capital Structure

Earnings per share performance remained robust across both quarterly and nine-month periods:

The paid-up equity share capital stood at ₹260.51 crores as of December 31, 2025, compared to ₹259.86 crores in the previous year. During the nine months ended December 31, 2025, the company allotted 5,83,520 equity shares pursuant to the exercise of stock options by employees.

Regulatory Compliance and Governance

The financial results comply with Indian Accounting Standards and SEBI Listing Regulations. The company's joint statutory auditors, M/s. CNK & Associates LLP and M/s M. M. Nissim & Co LLP, have reviewed the results and provided unmodified conclusions.

The company maintains a debt-equity ratio of 3.63 and reported gross non-performing assets at 1.04% with net non-performing assets at 0.68%, indicating healthy asset quality. The provision coverage ratio stands at 34.77%, demonstrating prudent risk management practices.

Source: PNB Housing Finance Limited

Motilal Oswal has maintained its BUY rating on PNB Housing Finance with a target price of ₹1,250, citing the company's resilient operating performance and recent leadership developments that are expected to strengthen its growth trajectory.

Strong Operating Performance Amid Challenges

The housing finance company has demonstrated robust performance despite facing multiple headwinds including regional disruptions, intensified competition from banks, and net interest margin (NIM) pressure in a declining interest rate environment. The brokerage noted that PNBHF has successfully navigated these challenges while maintaining growth momentum and asset quality standards.

Leadership Transition Brings Stability

A key development highlighted by Motilal Oswal is the appointment of Mr. Ajai Shukla as Managing Director & CEO, following a brief period of leadership transition. Mr. Shukla brings significant experience from his previous role as Chief Business Officer-Retail at Tata Capital Housing Finance.

The brokerage believes this appointment will materially strengthen the company's execution capabilities and boost confidence in its ability to deliver on medium- to long-term growth guidance, particularly its strategic shift toward higher-yielding business segments.

Financial Projections and Valuation

Motilal Oswal has outlined strong growth projections for PNB Housing Finance over the coming years. The brokerage expects significant expansion in both loan portfolio and profitability metrics.

Attractive Valuation Opportunity

At the current valuation of 1.2x FY27 P/B, Motilal Oswal sees attractive upside potential for investors. The target price of ₹1,250 is based on 1.4x Dec'27E book value per share (BVPS), suggesting significant appreciation potential from current levels.

The brokerage's positive outlook is supported by the company's balanced operating performance relative to peers and its strategic positioning in higher-yielding business segments, which should drive sustainable growth and improved profitability metrics in the medium term.