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Mumbai: Retail Non-Banking Financial Company (NBFC) IndoStar Capital Finance Limited has announced a ₹424 crore loss in Q4 FY26 as the company has had to take a credit and accounting hit on its stressed assets. Excluding this, the company has seen a healthy 5% growth in Assets Under Management (AUM) for the quarter at ₹8,056 crores, strengthened by its core vehicle finance business and its emerging property mortgage business.
Promising Numbers Underneath the Losses
Despite the cash-only, one time loss, Indostar has seen its retail lending business grow well, with its Net Interest Income (NII) surging 8.9% to ₹215 crore, even as its Total AUM has grown due to strong expansion in its core commercial vehicle financing along with its rapidly expanding Micro LAP (Loan Against Property) segment. The company’s weighted average cost of funds has also fallen sharply by 80 basis points as well.
Fully Burying the Legacy Non-Performing Book
Indostar has been carrying the weight of its stressed assets for various quarters now, as the company has now pivoted to lending to tier-2 to tier-4 retail customers. Though the company has taken a hit to its profitability, this has been done to de-risk itself from volatility in future earnings.
Standout Q4 FY26 Financials
Despite the hit, Indostar’s financials remains promising.
| Performance Parameter | Q4 FY26 | Q4 FY25 | Year-on-Year (YoY) / QoQ Shift | Financial Analysis |
| Net Interest Income (NII) | ₹215 crore | ₹209 crore | ▲ Up 8.3% QoQ | Showcases highly robust yield realizations across fresh retail originations. |
| Cost of Funds (%) | 10.20% | 11.00% | ▼ Reduced by 80 bps | Directly drives net interest margin (NIM) expansion moving into FY27. |
| Consolidated Net PAT | (₹424.00 Crore Loss) | ₹12 crore | One-Time Accounting Hit | Non-cash provisioning that removes the risk of future legacy asset slippages. |
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