Financial Services · NSE: SHRIRAMFIN
Shriram Finance
Q2 FY27 earnings call · Guided by management
Call held 23 Oct 2026 · Read the filing on NSEFiling
- M.Cap
- ₹2,36,192Cr₹2.36L Cr
- P/E
- 18.6×
- 1Y return
- +22.04%
- From 52W high
- −13.0%
Highlights are read by AI from the company's filing and can contain mistakes. Check the source page linked to each line.
Share price
Results Q2 FY27, as filed · consolidated · ₹ Cr
| Q2 FY27 | Q2 FY26 | YoY | Q1 FY27 | QoQ | |
|---|---|---|---|---|---|
| Revenue | 13,792 | 11,912 | +15.8% | 13,400 | +2.9% |
| PBTProfit before tax | 4,932 | 3,113 | +58.4% | 4,626 | +6.6% |
| Net profit | 3,684 | 2,314 | +59.2% | 3,453 | +6.7% |
| EPS (₹) | 15.66 | 12.29 | +27.4% | 14.85 | +5.5% |
From the company's own results filing on NSE. Net profit is the owners' share. Growth and the dotted lines are worked out from the filed figures.
Guidance
Gold loans: Gold loan growth plan kept unchanged
Umesh Revankar · Executive Vice Chairman · Q&A · p. 16
Gold loans: Gold loan growth plan kept unchanged
“No change in there is no change. We will go as per the plan.”
More figures from the call
“How can I exactly tell you the how it will move? It is not, that's why we are telling you in the medium term, it slows it comes down to around nine, and in the long term, it will settle down at around 8.5.”
“Having said that, the medium to long-term guidance will be the cost to income will be around 25%.”
“So, cost of liabilities on book is 8.4%, and I don't expect the incremental cost to be more than 8% as of now.”
“Incremental cost can slightly go up by from 8% to around 8.35% level. But still, that overall liabilities being at 8.4%, I don't expect the overall liability cost to go up for us for the entire liability book.”
“It should be around 72% to 73%.”
“Liquidity-wise, we have brought down the liquidity, and it is now at our 3 months of future liability level. So, nothing of excess liquidity now, and our borrowing program will continue the way it was in the previous quarters.”
In short
- 01Growth guided at 15% to 17%, below the initial 18% guidance, due to the West Asia war and weak monsoon.
- 02Credit cost guidance kept at 2%, with a temporary rise of 30-40 basis points in some areas for one or two quarters.
- 03PAT rose 59.37% to INR3,677.03 crores; AUM grew 16.96% year-on-year.
- 04Incremental cost of funds expected at no more than 8%, possibly up to about 8.35% if rates rise.
- 05Higher Stage 2 and Stage 3 loans attributed to seasonal and drought effects; gold loan stress to EMI product change.
- 06Draft IRDA rules may cut insurance commission income by about INR100 crores, which management calls not material.
- 07Interim dividend of INR6.5 per share declared, record date October 29, 2026.
Segments
MSME: MSME book expected to grow faster than other segments due to wider reach
Umesh Revankar · Executive Vice Chairman · p. 7
MSME: MSME book expected to grow faster than other segments due to wider reach
“So, we expect MSME book to grow much faster than other segment because of the bigger geographical reach.”
MSME: MSME growth from more geography and larger ticket sizes where comfortable
Umesh Revankar · Executive Vice Chairman · Q&A · p. 7
MSME: MSME growth from more geography and larger ticket sizes where comfortable
“No, it's a combination of both. But wherever we have a comfort, then ticket size will go up.”
MSME: MSME growth driven by expansion across India; no ECLGS availed
Umesh Revankar · Executive Vice Chairman · p. 8
MSME: MSME growth driven by expansion across India; no ECLGS availed
“Now, we are growing across India. So the MSME growth is mainly because of larger geography we are reaching out.”
Gold loans: Rise in gold loan stress put down to new EMI and interest-servicing loans
Umesh Revankar · Executive Vice Chairman · p. 13
Gold loans: Rise in gold loan stress put down to new EMI and interest-servicing loans
“No, no, it's basically because we had introduced EMI and interest servicing gold loans.”
Gold loans: No credit cost in gold loans as gold can be sold
Umesh Revankar · Executive Vice Chairman · p. 14
Gold loans: No credit cost in gold loans as gold can be sold
“Abhishek, we can always take action and sell the gold and appropriate it. So we don't have any credit cost in the gold loan.”
Demand
Rural demand was higher in last two quarters; caution in drought areas in last month
Umesh Revankar · Executive Vice Chairman · p. 10
Rural demand was higher in last two quarters; caution in drought areas in last month
“In fact, the demand from rural was much higher in the last two quarters. Only now in the last 1 month, we have been little cautious on certain drought-prone areas.”
Construction equipment: Construction equipment demand returning as government spend rises
Umesh Revankar · Executive Vice Chairman · p. 10
Construction equipment: Construction equipment demand returning as government spend rises
“Now in the last quarter, we are seeing the government spend is going up, and slowly the demand for construction equipment is coming back.”
Commercial vehicles: Commercial vehicle sales rose 28.7% in Q2 FY27 to 3.09 lakh units
Umesh Revankar · Executive Vice Chairman · p. 4
Commercial vehicles: Commercial vehicle sales rose 28.7% in Q2 FY27 to 3.09 lakh units
“The commercial vehicle sales has increased by 28.7% in Q2 FY27, and stands at 3.09 lakh units against 2.4 lakh units sold in the Q2 FY26.”
Second half is usually busier; management expects to do better
Umesh Revankar · Executive Vice Chairman · p. 18
Second half is usually busier; management expects to do better
“Normally, second half of the year is much busier, and we are confident of performing, outperforming and coming back to you again.”
Management sees credit demand holding up
Umesh Revankar · Executive Vice Chairman · p. 10
Management sees credit demand holding up
“So, we don't see any of that, and all the economic indicators say that India is growing well. Demand credit is quite good, and we are also witnessing the demand.”
Margins and costs
Rising interest cost and more new-vehicle lending to compress NIM
Umesh Revankar · Executive Vice Chairman · p. 9
Rising interest cost and more new-vehicle lending to compress NIM
“No, we are talking about increasing interest cost, that's one thing. And also, as we lend to more new vehicles, where the yields are a little lower, definitely there will be some NIM compression.”
Cost to income ratio was 22.52% in Q2 against 27.76% a year ago
Parag Sharma · Managing Director and Chief Executive Officer · p. 5
Cost to income ratio was 22.52% in Q2 against 27.76% a year ago
“Our cost to income ratio was 22.52% in Q2 FY27, as against 27.76% recorded in Q2 FY26.”
Technology spending may add to opex
S. Sunder · Joint Managing Director and Chief Financial Officer · p. 17
Technology spending may add to opex
“See, what will happen is that there'll be additional cost on the technology front, and that may have an impact on the overall opex.”
Yield gap between new and used vehicle loans is 200 to 400 basis points
Umesh Revankar · Executive Vice Chairman · p. 9
Yield gap between new and used vehicle loans is 200 to 400 basis points
“It is normally it depends upon segment to segment. It will be between 200 to 400 basis points.”
Pricing can change only on new loans; lending is fixed-rate
Umesh Revankar · Executive Vice Chairman · p. 15
Pricing can change only on new loans; lending is fixed-rate
“See, pricing I can do only for the new loan that I am booking. For existing loan, I can't do it, no? So I can price it only for as the new loans. So we don't have a floating rate scenario. NBFCs normally have fixed-rate lending.”
Debt and working capital
Borrowing cost may not fall if rates rise, but expected to hold at current level
Parag Sharma · Managing Director and Chief Executive Officer · Q&A · p. 12
Borrowing cost may not fall if rates rise, but expected to hold at current level
“And if rate further goes up and continue to remain at even at the current level, we may not be able to reduce our borrowing cost, but we are confident of maintaining it at the current level.”
Cost of liabilities 8.41%, down 15 basis points; incremental cost 7.3
Parag Sharma · Managing Director and Chief Executive Officer · p. 5
Cost of liabilities 8.41%, down 15 basis points; incremental cost 7.3
“The cost of liabilities on balance sheet is 8.41% versus 8.56% in the previous quarter, a reduction of 15 basis points, and from March, it is down by 18 basis points. The incremental cost of fund for the quarter was 7.3 versus 7.7 in the previous quarter.”
Liquidity coverage ratio 303 against 262 in the previous quarter
Parag Sharma · Managing Director and Chief Executive Officer · p. 5
Liquidity coverage ratio 303 against 262 in the previous quarter
“The liquidity coverage ratio was 303 versus 262 in the previous quarter.”
Leverage 2.16 times; capital adequacy ratio 33.24%
Parag Sharma · Managing Director and Chief Executive Officer · p. 5
Leverage 2.16 times; capital adequacy ratio 33.24%
“And leverage ratio was 2.16 times versus 2.14 times in the previous quarter, and March was 3.82. The capital adequacy ratio is at 33.24% versus 34% in the previous quarter.”
Total liabilities 2,36,271 with public deposits at 31%
Parag Sharma · Managing Director and Chief Executive Officer · p. 5
Total liabilities 2,36,271 with public deposits at 31%
“On the liability side, the total liability stands at 2,36,271 broken up into public deposits, which is 31%, non-convertible debentures, that is capital market borrowing at 15.71%, ECB loan and bond at 16.5%, the domestic bank borrowing and institutional borrowing is at 21%, and securitization at 14%.”
Dividends and buybacks
Interim dividend of INR6.5 per share; record date October 29, 2026
Parag Sharma · Managing Director and Chief Executive Officer · p. 5
Interim dividend of INR6.5 per share; record date October 29, 2026
“The Board also declared an interim dividend of INR6.5 per share, that is 325%. The record date for the entitlement thereof has been fixed at October 29, 2026.”
One-offs
Q1 staff cost was raised by annual bonuses; Q2 more normal
S. Sunder · Joint Managing Director and Chief Financial Officer · p. 17
Q1 staff cost was raised by annual bonuses; Q2 more normal
“No, the previous quarter, we had the annual bonuses released for the back office team, and hence, the staff cost was slightly elevated. The current quarter was more normalized.”
Risks
Rise in loan stress seen as seasonal and limited to low-rainfall areas
Umesh Revankar · Executive Vice Chairman · p. 6
Rise in loan stress seen as seasonal and limited to low-rainfall areas
“See, it is basically the seasonal and also from certain geography where there are less rainfalls. But we don't expect this to be a widespread thing.”
Maharashtra, Karnataka and Telangana are the most hit drought areas
Umesh Revankar · Executive Vice Chairman · p. 11
Maharashtra, Karnataka and Telangana are the most hit drought areas
“I don't have the number, but generally, the Maharashtra, Karnataka, Telangana are the largest hit now, and we have reasonably large size there.”
Credit cost on total assets was 2.03% in Q2 against 1.66% in Q1
Parag Sharma · Managing Director and Chief Executive Officer · p. 5
Credit cost on total assets was 2.03% in Q2 against 1.66% in Q1
“Our credit cost on total assets for Q2 FY27 stood at 2.03% as against 1.68% in Q2 FY26 and 1.66% for Q1 FY27.”
Floods seen as temporary with no negative impact
Umesh Revankar · Executive Vice Chairman · p. 12
Floods seen as temporary with no negative impact
“See, flooding is something very normal in the monsoon season. It will not have any negative impact.”
Asset resale values remain strong; no long-term credit cost worry
Umesh Revankar · Executive Vice Chairman · p. 12
Asset resale values remain strong; no long-term credit cost worry
“The asset values have remained very strong throughout. The resale value of every asset has been quite good, so nothing really to worry about a long-term prospect or increase in the credit cost.”
Other
Growth was about 15% in Q1 and 17% in Q2
Umesh Revankar · Executive Vice Chairman · p. 8
Growth was about 15% in Q1 and 17% in Q2
“The first quarter, our growth was around 15%. In the second quarter, it was 17%.”
Credit cost on the loan book is 2.3%
Umesh Revankar · Executive Vice Chairman · Q&A · p. 6
Credit cost on the loan book is 2.3%
“On the loan book, it's 2.3%. It's not 2.5%.”
LTVs cut and lending tightened only when the economy slows
Umesh Revankar · Executive Vice Chairman · p. 10
LTVs cut and lending tightened only when the economy slows
“So definitely, whenever the environment are little against economic activities slowing down, only then we decrease our LTVs and tighten the lending. Otherwise, we don't really change the LTV norms.”
AUM grew 16.96% year-on-year and 4.85% sequentially
Parag Sharma · Managing Director and Chief Executive Officer · p. 5
AUM grew 16.96% year-on-year and 4.85% sequentially
“Our AUM as on 30th September 2026 registered a growth of 16.96% over Q2 FY26 and a 4.85% sequentially.”
Q2 NIM was 9.52% against 8.19% a year ago
Parag Sharma · Managing Director and Chief Executive Officer · p. 5
Q2 NIM was 9.52% against 8.19% a year ago
“Our net interest margin in Q2 FY27 was 9.52% as against 8.19% in Q2 FY26 and 9.04% in Q1 FY27.”
Sources
- Earnings call transcript, Q2 FY27 Filed 27 Oct 2026 · 18 pages
Management's own statements, quoted from its NSE filings. This page was read by AI and can contain mistakes: check the source pages before relying on any figure. No forecast or opinion of ours. Not investment advice.