Cholamandalam Finance CFO Confident on FY26 Growth Targets as Profit Jumps 19%

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AuthorAarav Shah|Published at:
Cholamandalam Finance CFO Confident on FY26 Growth Targets as Profit Jumps 19%
Overview

Cholamandalam Investment and Finance Company Limited (CIFCL) is firmly on track to meet its FY26 Assets Under Management (AUM) growth targets, according to CFO D Arul Selvan. The non-banking lender reported a 19% year-on-year increase in net profit to ₹1,288 crore for Q3FY26, driven by strong disbursements across vehicle finance, loans against property, and home loans. Disbursements grew 16% overall, with the nascent gold loan business also scaling rapidly.

Growth Trajectory Maintained

Cholamandalam Investment and Finance Company Limited (CIFCL) leadership expressed strong confidence in achieving previously stated Assets Under Management (AUM) growth targets for the fiscal year 2026. Chief Financial Officer D Arul Selvan indicated the company is performing well against its guidance, projecting a 20-22% expansion for FY26. Vehicle finance, a core segment, has demonstrated robust traction following strategic rationalization, with expectations for continued growth into the fourth quarter.

Q3 Profitability Boosted by Disbursements

The company posted a net profit of ₹1,288 crore for the quarter ending December 2025, marking a significant 19% increase compared to the same period last year. This improved profitability was primarily fueled by increased disbursements across key business verticals including vehicle finance, loans against property, and burgeoning home loans. Overall disbursements saw a healthy 16% rise in the latest quarter, underscoring operational momentum.

Expanding Business Lines and Asset Quality Focus

CIFCL's recent foray into gold loans continues to gain traction, with disbursements reaching ₹772 crore in Q3FY26 across 118 dedicated branches. The NBFC anticipates a moderation in credit costs during Q4, supported by sustained growth in vehicle and home loans and a planned reduction in its Consumer & Small Enterprise Loans (CSEL) portfolio. While credit costs remained elevated at 1.8% in Q3, Selvan noted that the lender is focusing on reducing Stage-2 assets to mitigate future provisioning.

Asset Quality Metrics

Despite efforts to manage risk, asset quality experienced a marginal sequential deterioration. Gross Non-Performing Assets (GNPAs) edged up to 4.63% as of December 2025 from 4.57% in September 2025. Similarly, Net Non-Performing Assets (NNPAs) rose to 3.13% from 3.07% over the same period. Management emphasized that these shifts are not cause for major concern and that focus remains on proactive asset management.

Capital Position Strong

In contrast to some industry peers seeking external capital infusions, CIFCL stated it currently has no plans for equity fundraising. The company affirmed it is adequately capitalized to support its growth ambitions, indicating a strong internal financial footing.

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