Capital Small Finance Bank Limited — Q3 FY26
Capital Small Finance Bank delivered a steady Q3 FY26 with 19.8% YoY advance growth and 18.5% YoY deposit growth, driven by secured lending in MSME and mortgage segments.
bullish
high
Financial stats pending filing verification
Claim Ledger
Did management answer the analysts?
Every material analyst question, graded on whether management actually answered it — with the verbatim exchange and quantitative claims checked against filed numbers.
83%Questions answered0Evaded / deflected12Questions audited
Answered
High priority
Growth and quality of NBFC non-MFI book and recovery on MFI account.
Asked by Anish Diwari, Vicaria Investment Management
Management provided specific numbers and status on both segments.
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Question
this NVFC book you have the corporate loans it seems that this quarter I'm seeing some growth as well in the third quarter or second quarter for non MFI business. So maybe what are you observing there in terms of quality of demand and second the NVFC MFI account which gave you credit cost in Q1 is there any development in terms of recovery?
Management (not named)
we are targeting highly capitalized low leveraged NBFCs. 72.1% of NBFC clients are A rated and above. NBFC MFI segment now only 48 KES, 0.58% of portfolio, net NPA only 7 Ks. Recovery has started, we recovered decent amount in Q3.
Partial answer
High priority
Original loan amount and provisions for the stressed MFI account.
Asked by Anish Diwari, Vicaria Investment Management
Gave original amount and net NPA but not the exact provisions booked.
did not specify exact provisions taken
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Question
On this NFI account, how much was the original amount? Let's say if there are 100 how much did you provide for and how much is left now?
Management (not named)
the pending net NPA is only 7 crores. original loan outstanding should be something around 21 or 22 odd crores. we have provided for certain amount and the pending value left is around 7 to 7 and a half.
Answered
High priority
Why SMA 1 and 2 pool increased quarter over quarter despite positive trends.
Asked by Anish Diwari, Vicaria Investment Management
Provided specific SMA percentage, seasonal explanation, and future guidance.
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Question
SMA 1 and SMA 2 pool if you look at it has increased quarter over quarter even compared to Q1 it is at a higher level. Although your slippages are down, your trends are positive. So here how are you interpreting this?
Management (not named)
SMA 1 and 2 for this period is around 6.46%. This is basically a seasonality trend. December last year this number was 6.05. Reason being Punjab, Haryana north India agriculture cash flow transition causes temporary SMA boost. We are confident of bringing it back sub 5% by March 31 2026.
Answered
Medium priority
How are agricultural loans secured and what is the recovery process?
Asked by Part Kota, Plus 91 Asset Management
Corrected misconception and detailed collateralization and LTV.
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Question
majority of our loan aum is to agricultural loans. how do we secure these loans considering majority of our loan book is secured loans.
Management (not named)
agriculture accounts for 28% of portfolio, not majority. Agriculture is secured by mortgage of land with LTV downward of 50% valued at collector rate. We lend to middle-income group farmers with ticket size 5-25 lakhs.
Answered
High priority
Outlook on cost of deposits and CASA sustainability, and NIM improvement path.
Asked by Krish Mata, Enam Holdings
Provided specific percentages and timeline for repricing and NIM improvement.
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Question
we've shown very strong ability to increase CASA this quarter at 36%. I wanted to understand the lag and repricing on the deposit book, where cost of deposit settles and how you maintain CASA level.
Management (not named)
cost of deposit reduced from 5.92% to 5.86%. 64% of term deposits are old higher-rate deposits repricing over next three quarters: 23% in Q4 FY26, 46% in Q1 FY27, 27% in Q2 FY27. We expect NIM expansion of 3-5 bps in Q4, 10 bps in Q1, 15 bps in Q2.
Partial answer
High priority
Ability to maintain yield on advances at 11% given competitive intensity.
Asked by Krish Mata, Enam Holdings
Acknowledged competitive pressure but did not give a specific yield target.
did not commit to maintaining 11% yield
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Question
We've shown impressive yield on advances maintained at 11% even with interest rate decline. How do you think about competitive intensity and ability to hold 11% going forward?
Management (not named)
MSME grew 42% YoY, LAP grew 18%. We are well placed with outreach and pricing. Yield depends on monetary policy but deposit repricing will auto-correct. We expect NIM improvement in Q4, Q1, Q2.
Partial answer
Medium priority
Product mix in new geographies and customer profile in Rajasthan.
Asked by Shrial Doshi, Aquarius Securities
Provided product mix but avoided specifics on customer selection.
declined to give rejection rates or specific customer profiles
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Question
while entering states like Rajasthan, Himachal, J&K, which segments are seeing higher growth? Also in Rajasthan, what are rejection rates and which customer profiles are you targeting?
Management (not named)
In Delhi NCR, Rajasthan, J&K we see higher traction in MSME and mortgage. Rajasthan is too early to comment on customer segment; we are in sanitization period. Business loan and LAP will give good outcomes.
Answered
High priority
Loan book mix target by FY29 and ROA trajectory to 1.5-1.6%.
Asked by Shrial Doshi, Aquarius Securities
Provided specific mix range and ROA milestones with quarterly phasing.
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Question
what is the kind of loan book mix we aspire by FY29 and timeline to reach 1.5-1.6% ROA?
Management (not named)
We intend to maintain agriculture, housing, LAP, business loan at 75-80% of portfolio. For ROA, from current 1.3% (excl exceptional), we aim for 1.4% in FY27 with 5 bps improvement each quarter, and 1.6% by FY29.
Answered
High priority
Economics of partnership model and credit cost increase this quarter.
Asked by Gorav Purohit, Systematics Group
Explained partnership structure and gave credit cost range.
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Question
on the partnerships you mentioned, how would the economics work? Will it be margin accretive? Second, credit cost has slightly aged up this quarter, any specific reason and normalized level in Q4?
Management (not named)
Partnership is FLG driven with variable linked to portfolio quality. It will be P&L positive. Credit cost for quarter is 0.2%, same as last year Q2. We intend to keep it range bound between 0.15 to 0.25.
Partial answer
Medium priority
Benefit from yield side due to agri mix and deposit repricing.
Asked by Gorav Purohit, Systematics Group
Gave NIM uplift numbers but not specific yield benefit from agri.
did not quantify yield benefit from agri mix
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Question
how much benefit do you expect on the yield side primarily from the agri book going up?
Management (not named)
Agri book will give some benefit but leader will be deposit cost. Q4 will see directional NIM change, Q1 we can see 10 bps upliftment. 63% high cost deposits repricing over next three quarters.
Answered
High priority
Gross NPA on agri and MFI books, and health of agri book.
Asked by Chin Nema, Preient Capital
Provided specific GNPA percentages and explained agri book dynamics.
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Question
could you share the gross NPA numbers on the agri book and the MFI book? Also color on broader health of agri book as growth sub 5% and NNPA trending upward.
Management (not named)
Agri gross NPA around 4.7%, MFI around 23-28%. Agri book growth subdued due to floods; we are cautious. Slippages in agri are 50% of overall but recovery strategy keeps it controlled. Yield on agri is 12.62% vs overall 11%.
Answered
Medium priority
Term deposit rate reduction and cost-to-income ratio outlook.
Asked by Vun Dubet, Share India Securities
Provided specific rates, reduction amounts, and cost-income outlook.
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Question
what is the term deposit rate the bank is offering and how much reduction was the bank able to take? Also cost to income ratio, to what level do you intend to exit FY26?
Management (not named)
We offer around 7% for one-year, 7.1% highest. We cut 60 bps over last 9 months from 7.6% to 7%. In Q3 we reduced by 15-20 bps. Cost-to-income at 60.9% is optimal; Q4 will be similar levels, declining trend over medium term.