Equitas Sma. Fin Q1 FY27 Results (NSE: EQUITASBNK)
Signal: Steady quarter
The read
Equitas Small Finance Bank delivered a strong earnings turnaround in Q1FY27, with PAT of ₹184 Cr vs a loss of ₹224 Cr a year ago, powered by a dramatic fall in credit cost from 6.48% to 1.37%. The bank sustained 27% YoY advance growth and 19% net income growth, while NIM held at 7.24%. Cost-to-income improved YoY but ticked up QoQ; cost of funds rose 11 bps. Asset quality improved with GNPA down 13 bps QoQ to 2.36%. ROA and ROE reached 1.18% and 11.76% respectively, marking a clear inflection from prior-year losses.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹1,836.35 Cr | 11.7% | |
| Net profit | ₹184 Cr | N/A |
P&L walk
PAT swung from a loss of ₹224 Cr in Q1FY26 to a profit of ₹184 Cr in Q1FY27, driven by a sharp decline in credit cost from 6.48% to 1.37%, while net income grew 19% YoY and opex grew 16% YoY; NIM remained largely steady at 7.24%.
Key positives
- PAT of ₹184 Cr vs loss of ₹224 Cr in Q1FY26 — a ₹408 Cr swing YoY.
- Credit cost fell sharply to 1.37% from 6.48% in Q1FY26, the primary driver of profitability.
- Gross advances grew 27% YoY, with gold loan up 179% YoY and MSE 28% YoY.
- Overall disbursements grew 93% YoY to ₹6,784 Cr.
- ROA improved to 1.18% and ROE to 11.76% from negative levels a year ago.
- GNPA reduced 13 bps QoQ to 2.36%; net slippages at 1.43% at second-lowest Q1 level in five years.
Key concerns
- Cost-to-income ratio increased sequentially to 68.38% from 67.52% in Q4FY26, as opex grew 5% QoQ vs net income +3% QoQ.
- Cost of funds rose 11 bps QoQ to 7.05%, pressuring NIM which slipped 12 bps QoQ to 7.24%.
- NNPA edged up 2 bps QoQ to 0.70%.
- CASA ratio remained flat at 25%.
- Deposit growth at 10% YoY lags advance growth of 27% YoY, potentially constraining balance sheet expansion.
Research and educational content only. Not investment advice.