Five-Star Business Finance (FIVESTAR) Q2 26/27 earnings summary

Executive summary

• Q2 FY27 disbursements hit a quarterly record of ₹20,778 Mn, up 39% QoQ and 74% YoY; AUM reached ₹146,396 Mn, up 7% QoQ and 14% YoY.

• Collections improved and 30+ DPD declined QoQ, while Gross Stage 3 remained at 3.48%; Q2 PAT was ₹29,931.75 lakh, up 10% QoQ and 5% YoY.

• Interim results received an unmodified limited-review conclusion from the joint statutory auditors.

Financial highlights

• Q2 total income was ₹8,750 Mn, up 8% YoY; net interest income was ₹7,073 Mn, up 13% YoY.

• Q2 PBT was ₹37,476.18 lakh, down 2% YoY; PAT was ₹29,931.75 lakh and included a ₹1,875.30 lakh reversal of excess prior-year tax provision.

• H1 FY27 total income was ₹17,138 Mn, up 7% YoY; NII was ₹13,746 Mn, up 12%, and PAT was ₹5,707 Mn, up 3%.

• Q2 yields were 22.26%; incremental customer lending rates rose 1%, with pass-through expected to build over 24–36 months.

• Q2 basic and diluted EPS were ₹10.14 and ₹10.13; book value per share was ₹266.02.

Outlook and guidance

• Management expects to comfortably exceed original FY27 AUM growth guidance; any revised target may follow Q3 results.

• Slippages and credit costs are expected to remain flattish for the rest of FY27; slippages were indicated at ~70 bps, with a possible downward trend next FY.

• FY27 year-end cost of funds could reach ~8.90%; second-half incremental borrowing costs are estimated at 8.70%–8.75%.

• Rising funding costs may pressure spreads and NIM; higher yields on new loans should cushion the impact gradually, while operating leverage could lower the quarterly OpEx ratio toward 6.75%–7% over the next couple of years.