Net Interest Margin (NIM)
7.29%
+57bps QoQ
NIM improved for second consecutive quarter, driven by lower income reversals and reduced cost of funds.
EQUITASSMALLFINANCEBANK
Financial Services
09 Apr 2026
Equitas Small Finance Bank Ltd — Q4 FY26
Equitas Small Finance Bank delivered a strong Q4 FY26 with PAT of ₹213 crore (highest ever, +46% YoY) driven by NIM expansion to 7.29% (+57bps QoQ) and credit cost falling to 1.11% (lowest in 8 quarters).
Financial stats pending filing verification
2-Minute Summary
✦ AI-Generated from Full Transcript
Equitas Small Finance Bank delivered a strong Q4 FY26 with PAT of ₹213 crore (highest ever, +46% YoY) driven by NIM expansion to 7.29% (+57bps QoQ) and credit cost falling to 1.11% (lowest in 8 quarters). Advances grew 22% YoY to ₹46,165 crore, with disbursements at a record ₹7,347 crore. Management guided for FY27 ROA of 1.2-1.25% (Q4 exit ~1.5%), factoring in NIM moderation to ~7% due to deposit rate hikes and seasonal slippage, and credit cost normalization to ~1.5%. Key risk: potential diesel price pass-through could stress the 12% CV portfolio if fuel costs rise >10%.
Key Numbers
Gross NPA
2.49%
-13bps QoQ
Asset quality improved with gross NPA declining sequentially to 2.49%.
Credit Cost
1.11%
-77bps QoQ
Credit cost at 1.11% was the lowest in eight quarters, aided by strong collections.
Disbursements
₹7,347 crore
+72% YoY
Record quarterly disbursements driven by strong momentum across all verticals.
Management Guidance
Advances growth of 20%+ YoY for FY27
Management reiterated guidance of 20%+ year-on-year growth in advances for FY27, supported by improved disbursements.
Management guidance growthFY27 ROA of 1.2-1.25% with Q4 exit at ~1.5%
Full-year ROA guided at 1.2-1.25%, with Q4 FY27 exit ROA expected around 1.5%, factoring in NIM moderation and credit cost normalization.
Management guidance marginsCredit cost to normalize to ~1.5% for FY27
Credit cost expected to rise from Q4's 1.11% to around 1.5% for the full year due to seasonal factors and normalization.
Management guidance marginsNIM to stabilize around 7%
Management expects NIM to moderate from 7.29% and stabilize around 7% due to deposit rate hikes and CD ratio management.
Management guidance marginsKey Risks
Geopolitical tensions and fuel price impact on CV portfolio
West Asia conflict could lead to diesel price hikes >10%, stressing the 12% CV portfolio due to lag in freight rate adjustment.
medium · management_commentaryNIM compression from deposit rate hikes
March 2026 rate hikes on savings and term deposits will increase cost of funds, pressuring NIM from Q1 FY27 onwards.
medium · management_commentarySeasonal slippage in H1 FY27
Q1 and Q2 are seasonally weak for collections, likely leading to higher GNP slippage and income reversals, impacting NIM and credit cost.
medium · management_commentaryPotential RBI rate hikes and systemic deposit competition
If RBI raises rates or deposit competition intensifies, cost of funds could rise further, though management believes ability to pass on costs to borrowers.
low · analyst_questionNotable Quotes
The NIM increased for the first time in Q3 after many years of decline and in Q4 the NIM continued to show an upward trajectory.
We have increased our interest rate on TD and SA during March 26 and this is expected to increase the cost of funds going forward.
Our micro finance which used to be around 50% in the past now it's come down to 10%.
Frequently Asked Questions
What was Equitas Small Finance's revenue in Q4 FY26?
Equitas Small Finance reported revenue of ₹1,239 Cr in Q4 FY26, representing a +18% change compared to the same quarter last year.
What guidance did Equitas Small Finance management give for FY27?
Advances growth of 20%+ YoY for FY27: Management reiterated guidance of 20%+ year-on-year growth in advances for FY27, supported by improved disbursements. FY27 ROA of 1.2-1.25% with Q4 exit at ~1.5%: Full-year ROA guided at 1.2-1.25%, with Q4 FY27 exit ROA expected around 1.5%, factoring in NIM moderation and credit cost normalization. Credit cost to normalize to ~1.5% for FY27: Credit cost expected to rise from Q4's 1.11% to around 1.5% for the full year due to seasonal factors and normalization. NIM to stabilize around 7%: Management expects NIM to moderate from 7.29% and stabilize around 7% due to deposit rate hikes and CD ratio management.
What are the key risks for Equitas Small Finance in FY27?
Key risks include Geopolitical tensions and fuel price impact on CV portfolio — West Asia conflict could lead to diesel price hikes >10%, stressing the 12% CV portfolio due to lag in freight rate adjustment.; NIM compression from deposit rate hikes — March 2026 rate hikes on savings and term deposits will increase cost of funds, pressuring NIM from Q1 FY27 onwards.; Seasonal slippage in H1 FY27 — Q1 and Q2 are seasonally weak for collections, likely leading to higher GNP slippage and income reversals, impacting NIM and credit cost.; Potential RBI rate hikes and systemic deposit competition — If RBI raises rates or deposit competition intensifies, cost of funds could rise further, though management believes ability to pass on costs to borrowers..
Did Equitas Small Finance meet its previous quarter's guidance?
Scorecard data is being built as historical quarters are processed.
Where can I read the full Equitas Small Finance Q4 FY26 concall transcript?
The full earnings conference call transcript or source release is available on the linked source material. This page provides an AI-generated summary with filing verification status shown on the financial stats.