Ceejay Finance Limited has received a rating reaffirmation from CARE Ratings Limited, maintaining its 'CARE BBB-; Stable / CARE A3' rating for bank facilities worth ₹15.00 crore. The rating agency cited the company's continuous funding support from Ceejay Group entities and secured lending practices as key strengths, while noting constraints from modest operational scale and geographical concentration.

Rating Rationale and Key Drivers

CARE Ratings based its reaffirmation on several positive factors including the company's secured nature of lending, healthy capital adequacy ratio, comfortable overall gearing, and adequate liquidity. The rating agency highlighted the diversified business interests of the Ceejay Group across tobacco, real estate, and finance sectors as providing stability to the financing operations.

However, the ratings remain constrained by the company's modest scale of operations, moderate asset quality, and significant product and geographical concentrations. The loan portfolio primarily consists of two-wheeler loans extended mostly in the Gujarat region, creating concentration risks.

Financial Performance and Capital Position

Ceejay Finance maintains robust capitalisation levels with a capital adequacy ratio of 63.59% as of H1FY26, significantly above the regulatory minimum requirement of 15.00%. The company's overall gearing stood at 0.56x during the same period, with gearing from external debt at just 0.14x, indicating low reliance on external borrowings.

The company benefits from continuous funding support from group entities through unsecured loans at relatively lower interest rates of 9.00%. Internal borrowings from group companies accounted for approximately 75% of total borrowings as of H1FY26, resulting in a healthy net interest margin of 19.47% in FY25.

Operational Scale and Geographic Presence

Ceejay Finance operates with a modest scale, maintaining assets under management of ₹117.03 crore as of September 30, 2025. The company has expanded its distribution network to 41 branches from 32 branches as of March 31, 2024, with a borrower base of 26,215 customers as of September 30, 2025.

The business remains highly concentrated geographically, with Gujarat accounting for approximately 95% of the AUM and Maharashtra contributing around 5%. This concentration exposes the company to region-specific economic or credit shocks, representing a key rating constraint.

Asset Quality and Risk Profile

The company's asset quality showed improvement with gross non-performing assets declining to 4.94% as of September 30, 2025, from 5.11% in FY25. On a 90+ days past due basis, the GNPA significantly dropped to 4.94% as of September 30, 2025, from 10.54% in FY25.

Ceejay Finance primarily extends financing to farmers, agricultural labourers, and small traders, representing a relatively riskier borrower segment. However, a significant portion of the loan portfolio is secured through vehicle hypothecation and property mortgages, providing comfort in the lending business.

Rating Sensitivities and Outlook

CARE Ratings maintains a stable outlook, believing that Ceejay Finance will continue receiving funding support from the Ceejay group while maintaining healthy profitability and comfortable capitalisation levels. Positive rating actions could result from substantial increase in operational scale with geographical diversification and improvement in asset quality with GNPA falling below 4.00% on a sustained basis.

Negative factors that could lead to rating downgrades include degrowth in operations impacting profitability, changes in group support philosophy, rise in gearing above 1.50x, or deterioration in asset quality with GNPA remaining above 7.50% on a sustained basis.

Source:

Ceejay Finance Limited has reported robust financial performance for the third quarter of FY26, with net profit surging 47.35% year-on-year. The company announced its unaudited financial results for the quarter and nine months ended December 31, 2025, following board approval on February 06, 2026.

Strong Quarterly Performance

The company delivered impressive profitability growth in Q3FY26, with key financial metrics showing substantial improvement over the previous year.

Despite a decline in total income, the company's profitability improved significantly due to effective expense management. Total expenses decreased by 17.78% to ₹450.95 lakhs compared to ₹548.44 lakhs in the same quarter last year.

Nine-Month Financial Overview

For the nine-month period ended December 31, 2025, Ceejay Finance maintained steady growth across key performance indicators.

Interest income, which forms the core revenue stream, grew by 5.02% to ₹1,974.98 lakhs during the nine-month period, reflecting the company's expanding lending operations.

Expense Analysis

The company's expense structure showed mixed trends across different categories during Q3FY26:

Earnings Per Share and Capital Structure

The company's earnings per share (EPS) for Q3FY26 stood at ₹4.88, compared to ₹3.31 in the corresponding quarter of the previous year. For the nine-month period, EPS reached ₹16.25 versus ₹15.09 in the previous year.

Regulatory Compliance and Governance

The financial results were reviewed by the Audit Committee and approved by the Board of Directors on February 06, 2026. The board meeting commenced at 04:00 P.M. (IST) and concluded at 04:55 P.M. (IST) at the company's registered office. The results have been prepared in accordance with Indian Accounting Standards (Ind AS) and SEBI guidelines.

The company's auditors, Kantilal Patel & Co., provided a clean review report with no material concerns regarding the financial statements. As a Non-Banking Financial Company, Ceejay Finance continues to comply with RBI regulations and maintains adequate impairment allowances under Ind AS 109. The impairment allowances under Ind AS 109 made by the company exceed the total provision required under IRACP norms, and accordingly, no amount is required to be transferred to impairment reserve.