Fedbank Financial Services Targets 25%+ AUM Growth Through Gold and Mortgage Expansion

Fedbank Financial Services (Fedfina), a retail-focused non-banking finance company (NBFC), has unveiled an ambitious growth strategy aimed at expanding its Assets Under Management (AUM) by over 25%. The company plans to achieve this growth primarily through its gold and mortgage-led business segments while simultaneously working to enhance its asset quality.

Strategic Focus on Gold and Mortgage Segments

Fedfina's strategy emphasizes two key areas:

Gold Loans: The company has shown significant progress in this segment, with gold loan AUM growing by 36.4% year-over-year to ₹6,731.00 crore, now contributing 41.7% to the total AUM.
Mortgage Loans: This segment, including medium and small-ticket Loan Against Property (LAP) and housing loans, saw a 22.6% year-over-year growth to ₹8,796.00 crore.

Financial Performance Highlights

Fedfina's recent quarterly results reflect the success of its focused strategy:

Metric	Amount (₹ crore)	YoY Growth
Net Interest Income	293.90	10.9%
Operating Profit	139.00	10.1%
Profit After Tax	80.20	24.2%
Total AUM	16,136.00	13.5%

Asset Quality and Operational Efficiency

The company has made strides in improving its asset quality:

Gross Stage III assets decreased to 1.9%
Net Stage III assets stood at 1.3%
Credit cost for the quarter was maintained at 0.9%

Technology-Driven Rural Market Penetration

Fedfina aims to maintain strong return on equity through technology-driven rural market penetration. This approach is evident in their digital initiatives:

Over 12 lakh app downloads
80%+ digital registrations
67%+ digital payments

Expansion and Reach

The company has expanded its physical presence:

Total branches increased to 699, spread across 17 states and union territories
57 new Gold Loan branches opened in the recent quarter

Future Outlook

Fedbank Financial Services' strategy of focusing on gold and mortgage-led business expansion, coupled with its efforts to improve asset quality and leverage technology for rural penetration, positions it well for sustained growth. The company's strong performance provides a solid foundation for achieving its ambitious AUM growth target of over 25%.

As Fedfina continues to execute its strategy, investors and stakeholders will be watching closely to see if the company can maintain its growth trajectory while managing risks in an evolving financial landscape.

1 Day	5 Days	1 Month	6 Months	1 Year	5 Years
-0.47%	-3.84%	+1.48%	+65.53%	+35.94%	+6.91%

Fedbank Financial Services Limited (FEDFINA) has reported a robust financial performance for the second quarter, with a significant increase in net profit and steady growth in total income.

Key Financial Highlights

Particulars (₹ in Crore)	Q2 FY2026	Q2 FY2025	YoY Change
Net Profit	80.15	64.55	24.17%
Total Income	535.99	519.09	3.26%
Interest Income	507.70	479.11	5.97%

Profit Growth and Income

FEDFINA's net profit for Q2 stood at ₹80.15 crore, marking a substantial 24.17% increase from ₹64.55 crore in the same quarter of the previous year. The company's total income rose to ₹535.99 crore, up by 3.26% compared to ₹519.09 crore in Q2 of the previous fiscal. Interest income, a key revenue driver, grew by 5.97% to ₹507.70 crore from ₹479.11 crore year-on-year.

Half-Year Performance

For the first half of the fiscal year, FEDFINA reported a net profit of ₹155.16 crore, showing growth over the ₹134.78 crore recorded in the corresponding period of the previous fiscal year.

Asset Quality and Capital Adequacy

The company maintained a strong asset quality with gross non-performing assets (GNPA) at 1.90% and net NPAs at 1.30%. FEDFINA's capital position remained robust with a capital adequacy ratio of 21.64%, well above regulatory requirements.

Other Key Metrics

Basic Earnings Per Share (EPS) for Q2 improved to ₹2.15, up from ₹1.74 in the same quarter of the previous year.
The company allotted 5,90,965 equity shares under its employee stock option schemes during the quarter.

Conclusion

Fedbank Financial Services Limited has demonstrated a strong financial performance in the second quarter, with significant growth in profitability and stable asset quality. The company's ability to increase its interest income and maintain a healthy capital adequacy ratio positions it well for sustained growth in the competitive NBFC sector.

Investors and stakeholders may look forward to the company's continued focus on expanding its loan book while maintaining asset quality in the coming quarters.