SG Finserve Q2 FY27 Results (NSE: SGFIN)
Signal: Earnings grew
The read
The trajectory remains rapid and increasingly balance-sheet-led: Q2 loan-book growth accelerated to 25% QoQ and 98% YoY, driving operating income up 115% YoY and PAT up 106% YoY, while cost-to-income stayed below 15% and NPAs remained NIL. The key monitor is whether the 25% QoQ scaling can continue without deterioration from the ₹2.5 Cr impairment provision.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹160.93 Cr | 115% | 18% |
| Net profit | ₹58.53 Cr | 106% | |
| EBIT margin | 0% |
P&L walk
Consolidated operating income rose to ₹160.93 Cr, up 115% YoY and 18% QoQ, with NII up 109% YoY and PAT up 106% YoY to ₹58.53 Cr; the 25% QoQ loan-book increase supported growth while cost-to-income remained below 15%.
Segments
No operating segment table was disclosed; the standalone-consolidated PAT gap was only ₹0.27 Cr, so subsidiaries neither materially lifted nor dragged group earnings.
Key positives
- Loan book reached ₹5,694 Cr, up 98% YoY and 25% QoQ, with over 80% of growth contributed by new customers.
- Operating income rose 115% YoY to ₹160.93 Cr and PAT rose 106% YoY to ₹58.53 Cr, with both reaching quarterly records.
- Cost-to-income remained below 15% and H1FY27 RoA was 4.9%, broadly above the stated 4.5%+ target.
- NPAs remained NIL despite 98% YoY loan-book growth; capital adequacy remained robust at ~27%.
- The business is broadening beyond its group ecosystem, with approximately 75% of the loan book contributed by customers outside the group ecosystem and new LAP and digital lending products commercialized.
Key concerns
- Impairment provision increased to ₹2.5 Cr in Q2FY27 from ₹0.9 Cr in Q1FY27 while loan book expanded 25% QoQ; future asset-quality performance needs validation as scaling continues.
- Debt/TNW was 2.7x and asset/equity was approximately 3.7x, so continued 25% QoQ loan-book growth will increase dependence on funding access and underwriting discipline.
- Q2FY27 interest expenses rose 125% YoY to ₹68.2 Cr, faster than the 115% YoY increase in operating income, warranting monitoring of funding costs and spreads.
Research and educational content only. Not investment advice.