Northern ARC Capital Ltd — Q4 FY26

Northern ARC Capital delivered a strong Q4 FY26 with PAT of ₹133 crore (up 32% QoQ) and full-year PAT of ₹406 crore (+33% YoY), driven by AUM growth of 22% YoY to ₹16,594 crore and NIM expansion of 25bps to 9.4%. The direct-to-customer segment now constitutes 59% of AUM, with MSME finance growing 43% YoY and consumer finance maintaining risk-adjusted yields of ~15%. Credit costs improved to 2.2% in Q4 (full year 2.8%), aided by RBI's FLG clarity and better collection efficiency. Management guided for AUM growth of 22-25% in FY27 and ROA of 3%+, with ROE targeting mid-to-late teens over 8-10 quarters. Key risk: geopolitical tensions in West Asia could impact MSME portfolio segments (currently <2% exposure).