Stock Report

Fusion Finance Reports Strong Q1 FY27 Performance; PBT rises 67% QoQ to INR 62 Crore; Disbursement Growth 88% YoY

Posted On : 2026-08-10 22:33:01( TIMEZONE : IST )

Fusion Finance Limited [BSE: 543652 | NSE: FUSION] today announced its financial results for the first quarter ended June 30, 2026, delivering another quarter of strong business and financial performance.

Profit Before Tax (PBT) increased 67% quarter-on-quarter to INR 62 crore in Q1 FY27 from INR 37 crore in Q4 FY26. Building on the foundation laid during FY26, the Company reported improvement across business growth, margins, asset quality and profitability, reflecting the effectiveness of its calibrated underwriting approach, strengthened risk framework and disciplined execution.

Our NIM for Q1 FY27 has improved to 11.93%, compared with 10.29% in Q1 FY26 and 11.44% in Q4 FY 26.

Our pre-provisioning operating profit stood at INR 102 crore in Q1 FY27, an increase of 18% from INR 87 crore in Q1 FY26 and an increase of 10% from INR 93 crore in Q4 FY26. This demonstrates the underlying earnings strength of the franchise and reflects the tangible benefits of the operating efficiencies we have systematically built over the last year.

Asset quality strengthened further with Gross NPA improving to 2.51% from 3.21% in Q4 FY26, while credit cost declined to INR 40 crore, achieving the seventh consecutive quarter of reduction.

Commenting on the performance, Mr. Sanjay Garyali, MD & CEO, Fusion Finance Limited, said: "Q1 FY27 reflects the strength of the foundation we built over the past year. The simultaneous improvement in profitability, asset quality and growth validates our disciplined approach to underwriting, risk management and execution. As customer leverage continues to moderate and our capital position remains strong, we are well placed to scale responsibly. Going forward, we will remain focused on technology-led operating efficiency, prudent portfolio expansion and creating sustainable long-term value for all our stakeholders."

Fusion Finance maintained a strong balance sheet with a CRAR of 36.95% and liquidity of INR 1,880 crore. The Company's marginal cost of borrowing declined ~246 bps YoY to 10.1%, while maintaining a healthy debt-to-equity ratio of 2.3x.

Technology-led initiatives continued with the beginning of enterprise-wide rollout of the Loan Management System in a phased manner and deployment of AI-enabled capabilities, driving stronger compliance, lower cost-to-serve, reduced operational fraud, and fully digital customer onboarding.

Q1 FY27 marks Fusion Finance's transition from stabilization to sustainable growth, with continued improvement across profitability, portfolio quality, capital strength and operating efficiency positioning the Company for disciplined expansion.

Key Financial Highlights

Profit Before Tax (PBT): Swung to a positive ₹62 crore in Q1 FY27, surging 67% sequentially over ₹37 crore in Q4 FY26 and reversing a loss before tax of ₹92 crore recorded in the corresponding prior-year quarter (Q1 FY26).

Pre-Provision Operating Profit (PPOP): Advanced 18% year-on-year (YoY) and 10% quarter-on-quarter (QoQ) to ₹102 crore, supported by revenue growth and disciplined operational overheads.

Total Income: Stood at ₹458 crore for the quarter, up 3% YoY from ₹446 crore in Q1 FY26 and 7% sequentially from ₹430 crore in Q4 FY26.

Disbursements & AUM: Quarterly disbursements stood at ₹1,783 crore, reflecting an 88% YoY surge over ₹950 crore in Q1 FY26, though lower by 17% QoQ against ₹2,140 crore in Q4 FY26. Total Assets Under Management (AUM) reached ₹7,702 crore (up 4% QoQ and 0.2% YoY), while AUM per branch improved to ₹5.1 crore.

Operating Expenses & Cost Efficiency: OPEX came in at ₹206 crore, declining 2% YoY and staying flat QoQ (up 1%). The Cost-to-Income Ratio improved sharply by 391 basis points YoY and 188 basis points QoQ to 66.9%.

Net Worth & Capital Position: Net worth rose 30% YoY to ₹2,521 crore. Capital Adequacy Ratio (CRAR) strengthened to 36.9% (up 743 bps YoY), providing substantial capital cushion, while the Debt-to-Equity (D/E) ratio stood comfortable at 2.3x.

Earnings Per Share (EPS): Basic EPS for Q1 FY27 came in at ₹3.86 (Diluted: ₹3.85), compared to negative EPS of ₹(7.44) in Q1 FY26 and ₹7.06 in Q4 FY26 (which included a non-recurring deferred tax asset recognition of ₹76.8 crore).

Asset Quality & Operational Metrics

Sharp Asset Quality Improvement: Gross Non-Performing Assets (GNPA) contracted 292 basis points YoY and 70 basis points QoQ to 2.5%, down from 5.4% in Q1 FY26 and 3.2% in Q4 FY26.

Reduction in Credit Costs: Total credit cost dropped 78% YoY and 29% QoQ to ₹40 crore, reflecting improved portfolio quality and write-back trajectories.

NIM Expansion: Net Interest Margin expanded to 11.9% (up 164 bps YoY and 49 bps QoQ), aided by a lower marginal cost of borrowing, which eased by 246 basis points YoY to 10.1%.

Collection Efficiency: Microfinance (MFI) collection efficiency improved to 99.8% in Q1 FY27, up 108 basis points YoY and 10 basis points QoQ.

Return Ratios: Annualized Return on Assets (ROA) expanded to 3.0% (up 108 bps QoQ over core Q4 FY26), while annualized Return on Equity (ROE) reached 10.0% (up 378 bps QoQ over core Q4 FY26).

Shares of Fusion Finance Limited was last trading in BSE at Rs. 207.10 as compared to the previous close of Rs. 204.70. The total number of shares traded during the day was 27375 in over 582 trades.

The stock hit an intraday high of Rs. 212.95 and intraday low of 203.50. The net turnover during the day was Rs. 5695131.00.