Piramal Finance Reports 67% Increase in Q2 FY27 Profit to ₹545 Crore as Revenue Rises 27%

Piramal Finance Delivers Strong Earnings Growth in September Quarter

Piramal Finance reported a 67% year-on-year increase in quarterly net profit to ₹545 crore for the second quarter of financial year 2026–27, supported by expanding lending operations and higher revenue.

Revenue increased approximately 27% compared with the corresponding period of the previous financial year, reflecting continued business growth at the non-banking financial services company.

The results for the quarter ended September 30, 2026, indicate an improvement in profitability that outpaced revenue growth.

The performance comes as India's lending industry continues to pursue opportunities across housing finance, retail credit, small-business financing and other secured lending products.

For Piramal Finance, the results highlight the importance of expanding its lending franchise while maintaining disciplined underwriting, funding efficiency and credit quality.

The company operates in a competitive financial services market where profitability depends not only on loan growth but also on borrowing costs, operating expenses and provisions for potential credit losses.

Key Financial Highlights of Piramal Finance Q2 FY27

Net Profit Rises to ₹545.42 Crore

Piramal Finance's consolidated net profit increased to ₹545.42 crore from ₹326.99 crore in the September 2025 quarter.

The increase of approximately ₹218 crore represented year-on-year growth of 66.8%.

Sequentially, profit increased 18.3% from ₹460.98 crore in the June 2026 quarter.

The improvement was supported by higher net interest income, operating efficiencies and the expansion of the company's lending portfolio.

The company's earnings performance also reflects progress in its transition toward a retail-focused financial services model.

Profit growth significantly exceeded revenue growth, indicating improved operating leverage.

However, comparisons with the previous year also reflect exceptional expenses recorded during the earlier period.

Revenue From Operations Increases 27.4%

Revenue from operations reached ₹3,659.19 crore, compared with ₹2,871.55 crore in Q2 FY26.

The increase represented approximately 27.4% year-on-year growth.

Sequentially, revenue increased 9% from ₹3,355.92 crore.

Total consolidated income rose to ₹3,717.16 crore from ₹2,900.27 crore a year earlier.

The growth reflects a larger loan portfolio and higher income from lending activities.

Interest income remains the principal revenue source for the company.

However, lending revenue must be assessed alongside borrowing costs, credit losses and operating expenditure to determine underlying profitability.

Net Interest Income Grows 35% to ₹1,530 Crore

Piramal Finance reported net interest income of approximately ₹1,530 crore, representing year-on-year growth of 35%.

Net interest income measures the difference between interest earned on loans and the cost of interest-bearing borrowings.

The increase was supported by expansion in the company's assets under management and improved lending margins.

Net interest margin increased to 6.5%, compared with approximately 6.15% in the corresponding quarter of the previous year.

The 35-basis-point improvement indicates stronger income generation relative to the company's interest-earning assets.

The margin remained stable sequentially.

Funding costs and the mix of lending products will remain important determinants of future margins.

Assets Under Management Reach ₹1.13 Lakh Crore

Piramal Finance's total assets under management increased 24% year-on-year to ₹1,13,112 crore.

Sequentially, AUM expanded approximately 6%.

The company's growth portfolio, excluding legacy assets associated with the earlier DHFL acquisition, increased 30% year-on-year to ₹1,11,440 crore.

This portfolio now represents approximately 98.5% of total AUM.

The increase demonstrates the scale of Piramal Finance's transition toward a diversified lending franchise.

AUM growth provides opportunities for higher interest income, but it also increases the importance of credit assessment and funding management.

The company's future performance will depend on maintaining portfolio quality as lending expands.

Retail Lending Accounts for 86% of AUM

Retail lending has become the dominant component of Piramal Finance's portfolio.

Retail assets under management increased 30% year-on-year to approximately ₹97,462 crore.

The segment accounted for around 86% of total AUM.

The company's retail lending products include home loans, loans against property, small-business finance, gold loans and other credit products.

Retail lending provides opportunities to serve a diversified customer base across different income categories and geographic markets.

However, each product carries different credit risks and funding requirements.

The company has emphasised secured lending as an important component of its portfolio strategy.

This approach supports diversification but does not eliminate the possibility of credit losses.

Retail Disbursements Rise 34% to ₹14,646 Crore

Piramal Finance reported retail loan disbursements of ₹14,646 crore during the September quarter.

This represented year-on-year growth of approximately 34%.

Disbursements measure the value of new loans issued during a period.

They provide an indication of customer demand and lending activity.

However, disbursement growth does not translate directly into equivalent AUM growth because borrowers also repay existing loans.

The company experienced elevated prepayments in parts of its portfolio, particularly wholesale real estate lending.

As a result, loan repayments offset some of the growth generated through new disbursements.

The company's ability to retain borrowers and expand customer relationships will remain important for future AUM growth.

Mortgage Lending Remains a Major Business

Mortgage-backed products account for approximately 57% of Piramal Finance's total AUM.

The portfolio includes home loans and loans against property.

Mortgage lending provides opportunities to finance residential property purchases and other secured borrowing requirements.

Demand is influenced by housing activity, property prices, household incomes and interest rates.

Piramal Finance has expanded its mortgage operations across different customer categories.

The company serves customers in major cities as well as smaller urban and semi-urban markets.

However, mortgage lending remains exposed to property market conditions and borrower repayment capacity.

Maintaining appropriate collateral valuations and underwriting standards will be essential for sustainable growth.

Wholesale Lending Remains a Smaller Portfolio Component

Wholesale lending represents approximately 12% of Piramal Finance's overall portfolio.

Wholesale AUM stood at approximately ₹13,978 crore.

The company has focused on granular lending opportunities, including financing for mid-income housing developers.

Management indicated that the average wholesale loan ticket size was approximately ₹55 crore.

The company also reported elevated early repayments in its wholesale real estate portfolio.

These repayments reduced the pace of reported AUM expansion.

While early repayment can reduce credit exposure, it can also affect future interest income and require the lender to identify replacement lending opportunities.

The company will continue to balance wholesale business growth with portfolio diversification and credit discipline.

Operating Profit Rises 64% to ₹846 Crore

Piramal Finance reported pre-provision operating profit of ₹846 crore.

This represented year-on-year growth of 64%.

The increase was supported by higher net interest income and improved operating efficiency.

Pre-provision operating profit measures earnings before accounting for loan-loss provisions and certain other adjustments.

It provides an indication of the underlying operating performance of a lending institution.

The substantial increase demonstrates that income growth exceeded the rise in recurring operating expenses.

However, final profitability also depends on provisions, taxes and other financial items.

The company's ability to maintain operating leverage will be important as its distribution network expands.

Cost-to-Income Ratio Improves to 52.1%

Piramal Finance's cost-to-income ratio declined to 52.1% from 61.2% a year earlier.

The improvement of approximately 9.1 percentage points reflects greater operating efficiency.

The ratio measures operating expenditure relative to operating income.

A lower ratio generally indicates that a company is using a smaller proportion of its income to support operations.

Piramal Finance has expanded its lending portfolio and branch network while investing in technology.

As the business scales, certain operating expenses can be distributed across a larger revenue base.

The company's retail operating expenses as a percentage of AUM declined to approximately 3.48%.

However, continued branch expansion and investment in technology will require additional expenditure.

The sustainability of operating efficiency gains will depend on productivity and revenue growth.

Legacy DHFL Portfolio Continues to Decline

Piramal Finance's transformation has been shaped by its acquisition of Dewan Housing Finance Corporation Limited's assets in 2021.

The acquisition created a significant legacy lending portfolio.

Since then, the company has focused on resolving, recovering and reducing legacy exposures while expanding its newer retail lending businesses.

The legacy portfolio has declined approximately 96% since March 2022.

It stood at around ₹1,673 crore at the end of September 2026.

This represented approximately 1.5% of total AUM.

The reduction indicates substantial progress in separating the company's current lending operations from its inherited portfolio.

Management expects the legacy business to become sufficiently small that separate reporting may no longer be necessary after the December 2026 quarter.

Asset Quality Remains Broadly Stable

Piramal Finance reported a gross non-performing asset ratio of approximately 2.4% at the end of September 2026.

The ratio remained broadly stable.

Non-performing assets represent loans where borrowers have failed to meet repayment obligations under the applicable classification rules.

Asset quality is an important measure for non-banking lenders because credit losses directly affect profitability.

Piramal Finance reported loan-loss provisions and fair-value losses of approximately ₹302 crore during the quarter.

This compared with ₹248 crore a year earlier.

The increase indicates that credit costs remain relevant despite the improvement in operating earnings.

Management has stated that the company has not observed widespread stress across its lending portfolio.

However, the company continues to monitor specific customer categories and geographic markets.

Credit Risks Require Continued Monitoring

Piramal Finance has identified certain areas requiring a cautious lending approach.

Management indicated that some salaried borrowers employed in the technology sector in southern India continued to show signs of repayment stress.

The company has adopted a selective approach toward such borrowers.

Credit performance can vary across industries and regions because of changes in employment, income and economic conditions.

Small-business borrowers may also be affected by fluctuations in demand and working capital requirements.

The company's ability to identify emerging risks early will remain important as it expands lending.

Strong portfolio growth must be supported by appropriate underwriting and collection practices.

Branch Network Expands to 838 Locations

Piramal Finance operated 838 branches across 621 cities in 25 states at the end of September 2026.

The network included 535 urban branches, 203 rural branches and 100 gold loan branches.

The expansion reflects the company's efforts to strengthen its presence across different customer markets.

Physical branches remain important for customer acquisition, documentation, collateral assessment and relationship management.

However, expanding a branch network involves additional operating costs.

The company must generate sufficient business volumes to support the investment.

The improvement in the cost-to-income ratio indicates progress in managing expenses while scaling operations.

Customer Base Reaches Approximately 6.5 Million

Piramal Finance's customer base increased approximately 26% year-on-year to around 6.5 million.

Customer expansion is important for the company's retail lending strategy.

A larger customer base can create opportunities for repeat lending and cross-selling financial products.

However, customer growth must be assessed alongside credit quality, customer acquisition costs and long-term profitability.

The company has developed a diversified product portfolio to serve different financing requirements.

Its lending operations now cover multiple secured and unsecured categories.

The expansion reflects the broader transformation of Piramal Finance into a retail-focused financial services company.

Artificial Intelligence Supports Operating Efficiency

Piramal Finance has increased its use of artificial intelligence across several business functions.

Applications include customer onboarding, credit assessment, fraud detection, collections and software development.

The company reported that AI-powered tools handled approximately 41% of customer onboarding conversations.

It also indicated that AI-assisted development accounted for approximately 57% of its software code generation.

Digital collections and automated customer interactions have expanded.

The company uses technology to analyse customer information and support lending decisions.

These systems can improve processing efficiency and reduce certain operating costs.

However, AI adoption also requires appropriate governance, data security and human oversight.

The financial contribution of these initiatives will depend on their effectiveness and implementation costs.

AI-Driven Credit Assessment Expands

Piramal Finance reported processing more than 2.1 million images through AI-enabled credit assessment systems during Q2 FY27.

This compared with approximately 59,000 images a year earlier.

The increase demonstrates rapid adoption of automated analysis in lending operations.

The company has also expanded the use of bank statement analysis and fraud detection tools.

Such technologies can help identify inconsistencies, assess customer information and support faster credit decisions.

However, automated assessments must remain consistent with applicable lending regulations and responsible credit practices.

The company will need to maintain effective controls over model performance and customer data.

Borrowing Costs Benefit From Credit Rating Improvements

Piramal Finance reported an incremental long-term borrowing cost of approximately 8.46% during the first half of FY27.

This compared with 8.67% in the second half of FY26.

The reduction followed improvements in the company's credit ratings.

Lower borrowing costs can support net interest margins and profitability.

However, the effect depends on how quickly existing borrowings are refinanced or replaced.

The company reported an overall borrowing cost of approximately 8.79%.

Funding costs remain important because non-banking financial companies depend on borrowings to support lending.

Management expects the benefit of improved credit ratings to support funding efficiency over the coming years.

Capital Raising Strengthens Financial Position

Piramal Finance has undertaken equity fundraising initiatives totalling approximately ₹3,850 crore.

The programme includes a qualified institutional placement of approximately ₹2,100 crore.

It also includes a preferential warrant issue of approximately ₹1,750 crore to a promoter-group entity.

The QIP was completed during the September quarter.

The warrant arrangement involves staged payment and conversion requirements.

The company received an initial payment of approximately ₹437.5 crore against the warrants following the quarter end.

The distinction is important because the full warrant amount is not equivalent to cash already received.

The fundraising is intended to strengthen the capital base and support future lending growth.

Additional equity can provide financial flexibility, although it may also affect the company's shareholding structure and earnings per share.

Former SBI Chairman Dinesh Kumar Khara Joins Board

Piramal Finance also announced the appointment of Dinesh Kumar Khara, former Chairman of the State Bank of India, as an independent director.

The appointment is for a five-year term beginning October 19, 2026.

Khara brings extensive experience in banking, financial services and institutional management.

His appointment adds senior banking expertise to the company's board.

Independent directors play an important role in corporate governance, oversight and strategic decision-making.

For a lending institution, board-level expertise in risk management and financial regulation can be particularly relevant.

The appointment comes as Piramal Finance continues expanding its retail lending franchise.

Management Maintains FY27 Profit Growth Outlook

Piramal Finance management has expressed confidence in achieving approximately 50% year-on-year net profit growth during FY27.

The outlook is supported by expanding lending operations, improving operating efficiency and lower incremental borrowing costs.

The company also expects continued growth in its retail portfolio.

However, management guidance is subject to changes in economic conditions, interest rates and credit performance.

The company must also manage the impact of potential regulatory developments.

Future profitability will depend on maintaining lending margins and controlling operating and credit costs.

The strong first-half earnings performance provides a foundation for the company's full-year objectives.

Proposed Insurance Commission Rules Present a Potential Risk

Piramal Finance distributes certain insurance products alongside its lending activities.

Management has highlighted potential changes to insurance distribution commission regulations as a factor that could affect future profitability.

The company generates approximately ₹200 crore from the distribution of life and non-life insurance products.

Management estimated that proposed changes, if implemented in their current form, could reduce return on assets by approximately 18–24 basis points in FY28.

This remains a potential impact rather than a confirmed financial outcome.

The final effect will depend on the regulations adopted and the company's response.

The development illustrates how regulatory changes can influence non-interest income for financial services companies.

First-Half Profit Rises 67% to ₹1,006 Crore

For the six months ended September 30, 2026, Piramal Finance reported consolidated net profit of ₹1,006.40 crore.

This compared with ₹603.36 crore in the corresponding period of FY26.

The increase represented approximately 67% year-on-year growth.

Revenue from operations increased to ₹7,015.11 crore from ₹5,510.80 crore.

Total consolidated income rose to ₹7,134.35 crore.

The first-half results indicate that the company's earnings growth extended beyond a single quarter.

The performance was supported by lending expansion and operating efficiencies.

However, the company's full-year results will depend on credit conditions and the pace of business growth during the remaining quarters.

Outlook for the Remainder of FY27

Piramal Finance enters the second half of FY27 with an expanding retail lending portfolio, improved operating efficiency and a stronger capital position.

Mortgage lending and other secured retail products remain important growth opportunities.

The company is also pursuing greater use of technology across customer acquisition, underwriting and collections.

Lower incremental borrowing costs could support margins.

However, loan repayments, credit quality and regulatory developments will remain important considerations.

The company must continue balancing growth with disciplined risk management.

Management's confidence in achieving substantial full-year profit growth reflects the progress made in transforming the lending business.

The sustainability of that growth will depend on consistent execution and favourable credit conditions.

Conclusion

Piramal Finance reported a 67% year-on-year increase in consolidated net profit to ₹545.42 crore for Q2 FY27, supported by higher lending income and improved operating efficiency.

Revenue from operations rose 27.4% to ₹3,659.19 crore, while net interest income increased 35% to ₹1,530 crore.

Assets under management expanded 24% to ₹1.13 lakh crore, with retail lending accounting for approximately 86% of the portfolio.

Pre-provision operating profit increased 64%, and the cost-to-income ratio improved to 52.1%.

The results demonstrate substantial progress in the company's transition toward a diversified retail lending franchise.

The reduction in legacy DHFL-related assets and improvements in borrowing costs provide additional support for the business.

However, credit risks, regulatory developments and the need to sustain lending margins remain important considerations.

Piramal Finance's performance during the remainder of FY27 will depend on its ability to maintain loan growth, operating efficiency and asset quality while executing its long-term transformation strategy.