Satin Creditcare Network vs South Indian Bank Q4 FY26

Satin Creditcare delivered a standout Q4 FY26, with consolidated PAT surging 640% YoY to ₹330 Cr, driven by sharp credit cost reduction (FY26: 3.8%, Q4: 2.5%) and strong AUM growth of 19% to ₹15,174 Cr. The microfinance sector is healing, and Satin is leading with best-in-class asset quality: standalone GNPA at 3.1% and X-bucket collection efficiency of 99.9%. Management guided standalone AUM growth of 15-20% for FY27 and credit cost of 3-3.5%, while raising the 2030 consolidated AUM target to ₹32,000 Cr (from ₹25,000 Cr). Non-MFI businesses (17% of AUM) are gaining traction, with housing and MSME finance growing rapidly. Key risk: any resurgence of geopolitical or inflation-driven stress could pressure rural demand and asset quality.

Guidance read

Standalone AUM growth 15-20% in FY27: Expects standalone AUM to reach ₹14,800-15,100 Cr by March 2027, driven by branch expansion and sector tailwinds. Credit cost target of 3-3.5% for FY27: Aims to reduce credit cost further from 3.8% in FY26, supported by improving asset quality and underwriting. Consolidated AUM target of ₹32,000 Cr by 2030: Revised upward from ₹25,000 Cr, reflecting strong growth in non-MFI businesses and core microfinance. Non-MFI AUM share target of 30% by 2030: Subsidiaries in housing, MSME, and tech are expected to drive diversification and improve ROA.

Risk read

Key risks include Geopolitical/inflation impact on rural demand — Rising fuel prices and inflation could squeeze household incomes, potentially affecting loan demand and asset quality.; Regulatory intervention on interest rates — Past RBI commentary on microfinance interest rates could resurface, especially if political pressure builds.; Forex volatility impact on reported profits — Foreign currency borrowings and hedging create quarterly swings in treasury income and finance costs, though neutral over time..

Promise ledger

Scorecard data is being built as historical quarters are processed.

South Indian Bank reported a strong Q4 FY26 with net profit of ₹408 crore (up 19% YoY) and full-year PAT of ₹1,455 crore (up 12% YoY). Asset quality improved sharply: gross NPA fell 177 bps YoY to 1.43% and net NPA to 0.29%. Slippage ratio was a record low 15 bps for the quarter. Growth was driven by a 46% surge in gold loans (now ₹24,729 crore) and a shift toward retail/MSME. NIM improved to 2.95% on better mix. Management guided for 15-16% loan growth in FY27 and expects NIM to widen further. Key risk: credit costs may rise from current unsustainably low levels (3 bps this quarter) due to geopolitical uncertainties.

Guidance read

Loan growth target of 15-16% for FY27: Management aims to grow advances at 15-16% in FY27, matching or exceeding industry growth. NIM to continue widening: NIM improved 9 bps QoQ to 2.95% in Q4; management expects further improvement from asset mix shift and deposit repricing. Positive operating leverage for third consecutive year: Management targets positive operating leverage in FY27, with revenue growth outpacing expense growth. Corporate book to reduce to ~33% of total advances: Medium-term target to bring corporate exposure down from 38% to about one-third of the loan book.

Risk read

Key risks include Credit cost normalization — Credit cost was only 3 bps in Q4, unsustainably low. Management expects it to trend upward due to geopolitical stresses.; Gold price volatility risk — A sharp drop in gold prices could erode collateral margins on the large gold loan book (₹24,729 crore). Management uses VaR and margin calls but extreme moves remain a risk.; Succession uncertainty — MD & CEO's term ends Sep 30, 2026. Board search is ongoing; any delay or unfavorable outcome could impact strategic continuity.; ECL transition impact — Transition to expected credit loss (ECL) norms may require higher provisions, though management expects no material impact..

Promise ledger

Scorecard data is being built as historical quarters are processed.