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CHOLAFIN – Cholamandalam Investment and Finance – Q4 FY26 Earnings Call – 4-May-26

Cholamandalam Investment and Finance topline growth (20–23% AUM) is structurally supported by diversification, but bottomline expansion hinges on credit cost discipline (1.5% target) and opex control; margins (NIMs ~8%) remain resilient unless macro shocks materialize.

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Also see: CHOLAFIN – Cholamandalam Investment and Finance Company – Q4 FY26 Financial Results – 30-Apr-26

3-Scenario Framework

📊 Base Case (50% Probability)

Key Drivers: Credit costs stabilize at 1.5%, AUM grows 20–23%, and CSEL ROA crosses 3%. Gold Loan contributes incrementally (INR 6,000–8,000 crore AUM) but opex remains elevated (~3.1% of AUM). Fuel prices rise 10% but LCV/SCV operators pass on costs.
Outcome: ROA at 3.5%, NIMs at 8%, and EPS grows 15–20% YoY.

BAJFINANCE – Bajaj Finance – Q4 FY26 Earnings Call – 29-Apr-26

BAJFINANCE: Topline resilience (20–24% AUM growth), bottomline outperformance (profit growth > AUM growth), and margin stability (ROA 4.4–4.6%) under base-case assumptions, with asymmetric downside risks tied to geopolitics and execution.

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Also see: BAJFINANCE – Bajaj Finance – Q4 FY26 Financial Results – 29-Apr-26

3-Scenario Framework

📊 Base Case (50% Probability)

Macro remains stable but volatile. AUM grows 22% (gold loans at 4–5% of AUM, MSME recovers in H2 FY27). Credit costs average 155 bps (MSME/2-wheeler tailwinds offset by mild macro headwinds). Opex/NTI improves 30 bps, NIM moderates slightly. ROA/ROE sustain at 4.5%/20%, with profit growth ~10–15% above AUM growth.

SHRIRAMFIN – Shriram Finance – Q4 FY26 Earnings Call – 24-Apr-26

SHRIRAMFIN: Topline resilience (15–20% AUM growth) with margin stability (8.5–9.0% NIM), but bottomline sensitivity to monsoon/fuel shocks (EPS range: -10% to +35%).

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Also see: SHRIRAMFIN – Shriram Finance – Q4 FY26 Financial Results – 24-Apr-26

3-Scenario Framework

📊 Base Case (50% Probability)

Monsoon at 95–100% LPA, fuel prices stabilize at $90–95/bbl, and geopolitical tensions ease. AUM grows 16–18% (CV/PV lead, MSME at 13–15%). NIM expands to 8.7–8.8% (cost-of-funds benefits). Credit cost remains at 1.6–1.8% (no major asset quality deterioration). EPS grows 20–25% YoY.

TATACAP – Tata Capital – Q4 FY26 Earnings Call – 23-Apr-26

TATACAP’s topline resilience (retail/SME dominance) and margin expansion (high-yield mix) offset cyclical risks (geopolitics, rates), but credit cost discipline and execution in Motor Finance are key swing factors for bottomline growth.

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Also see: TATACAP – Tata Capital – Q4 FY26 Financial Results – 23-Apr-26

3-Scenario Framework

📊 Base Case (60% Probability)

Key Variables: Stable macro (7% GDP growth), no major geopolitical escalation, RBI holds rates.
Outcome: AUM grows 23–25%, ROA 2.5–2.7% by FY28, credit costs <1%, NIMs expand 10–15bps via product mix shift. Motor Finance ROA reaches 2% by FY28.

CHOLAFIN – Cholamandalam Investment and Finance Company – Q4 FY26 Financial Results – 30-Apr-26

Cholamandalam’s FY27 entry shows 22.8% PAT growth, diversified loan book, and Q4 acceleration. LAP/Home Loans scale profitably, but credit costs up 41.8% and derivative exposure spike threaten margins. NIM trends, Stage‑2/3 assets, and credit cost normalization will decide if valuation premium holds.

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🔍 Observations

Topline

Total Income rose 20.6% YoY (₹26,152.56 Cr → ₹31,538.73 Cr in FY26), driven primarily by Interest Income up 19.6% (₹23,747.74 Cr → ₹28,403.26 Cr).
Fee & Commission Income surged 21.6% YoY (₹1,739.08 Cr → ₹2,114.21 Cr), signaling strong disbursement volumes and cross-sell momentum.
Q4 FY26 Total Income of ₹8,563.54 Cr grew 20.0% YoY and 6.9% QoQ — sequential acceleration intact.

Bottomline

PAT grew 22.8% YoY (₹4,262.70 Cr → ₹5,232.61 Cr); Q4 FY26 PAT of ₹1,645.20 Cr jumped 30.6% YoY and 27.5% QoQ — strong exit momentum.
Basic EPS expanded 22.2% YoY (₹50.72 → ₹61.98), with share count near-flat, confirming earnings quality is not dilution-driven.
Tax rate was effectively stable (~25%), with deferred tax credits (₹269.65 Cr) providing modest PAT support.

Margins

PBT Margin (PBT/Total Income): FY26 = 22.1% vs FY25 = 22.0% — near-flat, suggesting cost growth is tracking revenue growth.
Net Profit Margin: FY26 = 16.6% vs FY25 = 16.3% — marginal improvement; financing costs (45.6% of total income) remain the dominant margin lever.
Impairment costs rose disproportionately — 41.8% YoY (₹2,494.31 Cr → ₹3,536.34 Cr) vs revenue growth of 20.6% — compressing credit-adjusted spreads.

Growth Trajectory

Loan book expanded 19.6% YoY (₹1,82,037.64 Cr → ₹2,17,743.72 Cr), sustaining the AUM compounding needed to drive future interest income.
LAP segment delivered standout PBT growth of 54.6% YoY (₹1,396.43 Cr → ₹2,158.97 Cr), becoming the second-largest profit contributor.
Home Loans PBT grew 23.7% YoY (₹693.12 Cr → ₹857.36 Cr) — scaling fast off a smaller base, adding segment diversification.

BAJFINANCE – Bajaj Finance – Q4 FY26 Financial Results – 29-Apr-26

Bajaj Finance’s Q4FY26 PAT peaked, FY26 earnings grew 15.2%, and loan book crossed ₹5L Cr. Credit costs normalized, supporting FY27 margin expansion. Yet deposit decline and wholesale reliance heighten liquidity risk. Discipline in funding mix and credit cost management now outweigh topline growth as structural drivers.

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🔍 Observations

Topline

Total revenue from operations grew 19.2% YoY (₹68,806 Cr → ₹81,982 Cr), led by interest income scaling 19.0% (₹61,164 Cr → ₹72,776 Cr) — loan book expansion is the primary engine.
Fee & commission income surged 29.6% YoY (₹5,983 Cr → ₹7,754 Cr), signalling deeper cross-sell penetration and product diversification beyond pure lending.
Q4FY26 revenue of ₹21,606 Cr grew 18.0% vs Q4FY25, with sequential improvement of 2.8% from Q3FY26 — momentum is intact and accelerating.

Bottomline

PAT grew 15.2% YoY (₹16,779 Cr → ₹19,332 Cr); Q4FY26 PAT of ₹5,553 Cr surged 22.2% vs Q4FY25 (₹4,546 Cr) — quarterly acceleration is notable.
Effective tax rate held at 25.1% in FY26 vs 24.0% in FY25; marginal uptick not material enough to distort profit trajectory.
Exceptional item (New Labour Codes charge of ₹265 Cr in Q3FY26) was a one-time drag — underlying PBT before exceptional items grew 18.1% YoY (₹22,080 Cr → ₹26,082 Cr).

Margins

Net profit margin (PAT / Total Income): FY26 = 23.6% vs FY25 = 24.4% — modest 80 bps compression, driven by finance costs growing faster (15.7% → 34.9% of revenue) than topline.
Finance costs grew 15.8% YoY (₹24,770 Cr → ₹28,666 Cr), broadly in line with loan book growth — cost of funds is not meaningfully deteriorating.
Impairment charges declined sharply QoQ: Q4FY26 ₹2,008 Cr vs Q3FY26 ₹3,425 Cr (-41.4%) — asset quality recovery in the latest quarter is the most significant margin driver.

Growth Trajectory

Loan book grew 22.3% YoY (₹4,07,844 Cr → ₹4,98,944 Cr) — crossing the ₹5 lakh crore threshold signals scale maturity without visible growth deceleration.
Employee costs grew 19.6% YoY (₹7,508 Cr → ₹8,979 Cr) — broadly tracking revenue, suggesting operating leverage is stable, not expanding.
Basic EPS grew 13.8% YoY (₹26.89 → ₹30.60) on a diluted share base, reflecting solid per-share value accretion despite equity expansion.

SHRIRAMFIN – Shriram Finance – Q4 FY26 Financial Results – 24-Apr-26

Shriram Finance’s FY26 delivered 21% PAT growth, a 41% Q4 surge, and stronger deposits. Liquidity buffers fell 63% and derivative outflows weigh near term, but solvency intact. Earnings expansion hinges on AUM compounding and credit cost efficiency; risks are borrowing cost spikes or asset quality stress in CV/SME.

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🔍 Observations

Topline

Interest income scaled 15.8% YoY to ₹46,658 Cr in FY26 (from ₹40,308 Cr), reflecting robust AUM expansion as the loan book grew ~15.1% YoY to ₹2,82,452 Cr.
Fee and commission income contracted 27.6% YoY (₹682 Cr → ₹494 Cr), partially offset by higher other operating income (+22.5% YoY); total revenue from operations rose 15.1% YoY to ₹48,133 Cr.
Q4FY26 interest income of ₹12,094 Cr grew 12.1% YoY and 2.1% QoQ, confirming steady sequential momentum with no quarterly deceleration.

Bottomline

Reported PAT from continuing operations grew 6.3% YoY to ₹10,005 Cr; stripping FY25’s exceptional gain of ₹1,554 Cr, normalized PAT growth is a stronger ~21% YoY — a cleaner read on operating leverage.
Q4FY26 PAT of ₹3,015 Cr surged 40.9% YoY (vs. ₹2,139 Cr in Q4FY25) and 19.4% QoQ, the sharpest quarterly earnings print in the visible period.
Basic EPS from continuing operations rose to ₹53.29 in FY26 from ₹50.19 in FY25 (+6.2% reported; ~21% normalized), with dilution negligible given marginal ESOP issuance.

Margins

Finance costs as a share of total income expanded to 44.7% in FY26 (from 44.1% in FY25), reflecting rising cost of funds pressure even as the loan book grows.
Net profit margin (PAT/Total Income, continuing ops) came in at 20.8% for FY26 vs. 22.5% in FY25 on a reported basis; on a normalized basis (ex-exceptional), FY25 base PAT margin was ~18.5%, indicating genuine margin expansion of ~230 bps.
Impairment charges as a share of total income remained stable at ~11.1% in FY26 (₹5,339 Cr / ₹48,133 Cr) vs. 12.7% in FY25 — improving credit cost efficiency on a growing book.

Growth Trajectory

AUM CAGR implied over FY25–26 at ~15%, with deposit-funded growth accelerating: deposits grew 23.9% YoY (₹56,086 Cr → ₹69,480 Cr), signaling a deliberate liability mix shift toward stickier retail funding.
Operating profit (PBT before exceptional) compounded from ₹10,949 Cr to ₹13,300 Cr (+21.5% YoY), demonstrating durable earnings power independent of one-off gains.
Q4FY26 PBT of ₹3,917 Cr vs. ₹2,772 Cr in Q4FY25 (+41.3% YoY) signals an accelerating exit run rate, a positive leading indicator for FY27.

TATACAP – Tata Capital – Q4 FY26 Financial Results – 23-Apr-26

Tata Capital’s FY26 marks inflection with 33.8% PAT growth, 15.4% margins, and 20.8% loan CAGR. ₹8,583 Cr equity raise de‑leverages balance sheet. Risks: negative OCF, reserve compression, credit cost trajectory. Long‑term profitability in financing segment compelling; near‑term liquidity and investment volatility warrant caution.

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🔍 Observations

Topline

Total income grew 11.3% YoY (₹28,370 Cr → ₹31,583 Cr in FY26), led by interest income rising 11.4% (₹25,724 Cr → ₹28,652 Cr) — financing activity remains the dominant growth engine at 97.5% of net segment revenue.
Q4FY26 total income hit ₹8,162 Cr, up 8.7% QoQ and 8.7% YoY — sequential momentum is steady and broad-based.
Fee & commission income declined 4.4% YoY (₹1,774 Cr → ₹1,696 Cr), a rare soft spot in an otherwise strong topline; rental income surged 63.4% YoY (₹272 Cr → ₹445 Cr) as a partially offsetting non-core contributor.

Bottomline

PAT nearly doubled over two years: FY26 PAT ₹4,891 Cr vs FY25 ₹3,655 Cr, a 33.8% YoY jump — Q4FY26 alone delivered ₹1,466 Cr, up 46.7% YoY (₹1,000 Cr → ₹1,466 Cr).
Basic EPS expanded from ₹9.32 in FY25 to ₹11.76 in FY26 (+26.2% YoY), reflecting earnings accretion despite equity dilution from the FY26 capital raise.
Impairment on financial instruments remained elevated at ₹3,023 Cr in FY26 (vs ₹2,827 Cr in FY25, +6.9% YoY), capping bottom-line upside even as operating leverage kicked in.

Margins

Net profit margin expanded sharply: 12.94% in FY25 → 15.36% in FY26 (+242 bps); Q4FY26 margin hit 18.41% — highest in the reported periods, pointing to structural improvement in cost absorption.
Finance costs as a % of total income: 53.0% in FY25 vs 50.6% in FY26 — modest but meaningful compression signals improving funding efficiency.
Operating leverage visible: total expenses grew 6.5% YoY (₹23,449 Cr → ₹24,981 Cr) against 11.3% income growth — expense growth running at roughly half the revenue growth rate.

Growth Trajectory

Loan book expanded 20.8% YoY (₹2,21,950 Cr → ₹2,68,203 Cr), sustaining the platform for forward interest income growth.
Financing segment EBIT grew 34.7% YoY (₹4,751 Cr → ₹6,402 Cr), confirming that core business profitability — not treasury or investment gains — is driving the upgrade cycle.
Net worth surged 38.8% YoY (₹32,443 Cr → ₹44,824 Cr), primarily via the ₹8,583 Cr equity raise in FY26 — significantly strengthening the capital base for the next growth phase.

MUTHOOTFIN – Q3 FY26 Earnings Call – 12-Feb-26

MUTHOOTFIN: Gold loan structural tailwinds and regulatory support underpin 18–22% AUM growth, but earnings quality hinges on NPA recovery sustainability and opex discipline; margins face 50–100 bps compression if cost inflation outpaces revenue, while competitive and macro risks cap upside to low-teens EPS growth.

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3-Scenario Framework

📊 Base Case (50% Probability)

Key Variables: Gold prices stable (±5%), MCLR pass-through in H2, regulated branch growth.
Outcome: AUM grows 18–22%, NIM stable at ~7.5% (recoveries offset funding lag). Opex growth moderates to 15%, margins 26–28%. EPS grows 8–12%, driven by gold loan dominance and subsidiary turnarounds. Guidance clarity supports valuation rerating.

CHOLAFIN – Q3 FY26 Earnings Call – 2-Feb-26

CHOLAFIN targets 20–25% AUM growth via vehicle finance and mortgages; margins hinge on funding costs and digital scaling. ROA (3.2–3.5%) faces asset quality risks, with FY27 inflection dependent on macro stability and portfolio seasoning.

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3-Scenario Framework

📊 Base Case (50% Probability)

Key variables: Cyclical recovery in vehicle demand (10–15% HCV/LCV growth), 5–10 bps Q4 cost of funds reduction, CSEL NCLs decline to 4.5% by FY27.
Outcome: NIM stabilizes at 8.0–8.1%; AUM grows 20–22%. Vehicle finance NCLs improve to 1.7%, CSEL to 4.5%. ROA reaches 3.3%, ROE at 19–20%. Interim dividend sustained at 65%.