Five-Star Business Finance (FIVESTAR) Q4 25/26 earnings summary

Executive summary

• Achieved 11% year-over-year AUM growth and 2% PAT growth in FY26, despite asset quality headwinds and senior management exits, with management confident about future growth.

• Collection efficiency improved significantly in Q4 FY26, reaching 98.1% (excluding NPA loans), among the best in company history.

• Disbursements and portfolio growth rebounded in Q4, with renewed focus on distribution, expansion, and sustainable growth.

• Audited financial results for FY26 were approved with an unmodified audit opinion; final dividend of INR 2 per share recommended.

Financial highlights

• Q4 FY26 disbursements: INR 1,213 crore (₹12,133 Mn), up 24% sequentially; full-year disbursements: INR 4,675 crore (₹46,757 Mn).

• Portfolio (AUM) grew 11% year-over-year to ₹132,246 Mn; total assets as of March 31, 2026, were INR 15,78,973.88 lakh.

• FY26 PAT: INR 1,09,874.53 lakh (₹10,988 Mn), up 2% year-over-year; Q4 PAT: INR 2,693 Mn.

• Net Interest Margin for FY26 was 19.86%; Q4 NIM at 20.07%.

• Cost of funds dropped to 8.95% in Q4; full-year cost of funds at 9.21%, with incremental borrowing at 8.53% in Q4.

Outlook and guidance

• Targeting AUM growth of around 20% for FY27, with focus on sustainable growth, robust risk management, and technology adoption.

• Credit cost guidance for FY27 at 1.7%-1.75% of average AUM, with steady-state expectation of 1.5%-1.6% in coming years.

• ROA expected at 8.25%-8.5% for FY27; OpEx to AUM to remain around 7%-7.25%.

• No plans to revise pricing in FY27; yields may see minor compression (30-40 bps) over next 3-4 quarters.

• Company operates as a systemically important non-deposit taking NBFC, with no reportable segments other than financing.