Financial Performance Overview

Fusion Finance Limited reported strong financial results for Q1 FY27 ended June 30, 2026. Profit Before Tax (PBT) increased 67% quarter-on-quarter to ₹62 crore from ₹37 crore in Q4 FY26. The company showed improvement across business growth, margins, asset quality, and profitability.

Key Financial Metrics

Income Statement:

  • Total Income: ₹458 crore in Q1 FY27, up 7% from ₹430 crore in Q4 FY26 and up 3% from ₹446 crore in Q1 FY26
  • Operating Expenses: ₹206 crore in Q1 FY27, up 1% from ₹205 crore in Q4 FY26 and down 2% from ₹210 crore in Q1 FY26
  • Pre-Provisioning Operating Profit (PPOP): ₹102 crore in Q1 FY27, up 10% from ₹93 crore in Q4 FY26 and up 18% from ₹87 crore in Q1 FY26
  • Credit Cost: ₹40 crore in Q1 FY27, down 29% from ₹56 crore in Q4 FY26 and down 78% from ₹179 crore in Q1 FY26
  • Profit Before Tax: ₹62 crore in Q1 FY27 compared to ₹37 crore in Q4 FY26 and (₹92) crore in Q1 FY26

Balance Sheet & Business Metrics:

  • Disbursement: ₹1,783 crore in Q1 FY27, down 17% from ₹2,140 crore in Q4 FY26 but up 88% from ₹950 crore in Q1 FY26
  • Assets Under Management (AUM): ₹7,702 crore in Q1 FY27, up 4% from ₹7,407 crore in Q4 FY26 and up 0.2% from ₹7,688 crore in Q1 FY26
  • AUM per Branch: ₹5.1 crore in Q1 FY27, up 6% from ₹4.8 crore in Q4 FY26 and up 3% from ₹4.9 crore in Q1 FY26
  • Net Worth: ₹2,521 crore in Q1 FY27, up 3% from ₹2,456 crore in Q4 FY26 and up 30% from ₹1,943 crore in Q1 FY26
  • EPS (Basic): ₹3.86 in Q1 FY27 compared to ₹7.06 in Q4 FY26 and (₹7.44) in Q1 FY26
  • EPS (Diluted): ₹3.85 in Q1 FY27 compared to ₹7.06 in Q4 FY26 and (₹7.44) in Q1 FY26

Key Ratios Performance

Q1 FY27 vs Previous Quarters:

  • Net Interest Margin (NIM): 11.93% in Q1 FY27 vs 11.44% in Q4 FY26 (+49 bps) and 10.29% in Q1 FY26 (+164 bps)
  • Marginal Cost of Borrowing: 10.1% in Q1 FY27 vs 10.3% in Q4 FY26 (-20 bps) and 12.6% in Q1 FY26 (-246 bps)
  • Collection Efficiency (MFI): 99.8% in Q1 FY27 vs 99.7% in Q4 FY26 (+10 bps) and 98.7% in Q1 FY26 (+108 bps)
  • Cost/Income Ratio: 66.9% in Q1 FY27 vs 68.8% in Q4 FY26 (-188 bps) and 70.8% in Q1 FY26 (-391 bps)
  • Debt-to-Equity Ratio: 2.3x in Q1 FY27 (same as Q4 FY26) vs 2.7x in Q1 FY26
  • CRAR: 36.95% in Q1 FY27 vs 36.5% in Q4 FY26 (+49 bps) and 29.5% in Q1 FY26 (+743 bps)
  • Gross NPA: 2.51% in Q1 FY27 vs 3.21% in Q4 FY26 (-70 bps) and 5.4% in Q1 FY26 (-292 bps)
  • Return on Assets (Annualized): 3.0% in Q1 FY27 vs 1.9%* in Q4 FY26 (+108 bps) and (4.7%) in Q1 FY26
  • Return on Equity (Annualized): 10.0% in Q1 FY27 vs 6.3%* in Q4 FY26 (+378 bps) and (20.6%) in Q1 FY26

*Excludes recognition of deferred tax assets (DTA) of ₹76.8 crore in Q4 FY26

Asset Quality & Capital Position

Asset quality strengthened significantly with Gross NPA improving to 2.51% from 3.21% in Q4 FY26. Credit cost declined to ₹40 crore, marking the seventh consecutive quarter of reduction. The company maintained a strong balance sheet with CRAR of 36.95% and liquidity of ₹1,880 crore.

Technology Initiatives

The company began enterprise-wide rollout of the Loan Management System in a phased manner and deployed AI-enabled capabilities. These initiatives are driving stronger compliance, lower cost-to-serve, reduced operational fraud, and fully digital customer onboarding.

Management Commentary

Mr. Sanjay Garyali, MD & CEO, stated: "Q1 FY27 reflects the strength of the foundation we built over the past year. The simultaneous improvement in profitability, asset quality and growth validates our disciplined approach to underwriting, risk management and execution. As customer leverage continues to moderate and our capital position remains strong, we are well placed to scale responsibly. Going forward, we will remain focused on technology-led operating efficiency, prudent portfolio expansion and creating sustainable long-term value for all our stakeholders."

Company Background

Fusion Finance Limited is among India's leading Non-Banking Financial Company-Microfinance Institutions (NBFC-MFIs), serving approximately 20.2 lakh clients across the country. The company has an extensive network of 1,512 branches spread across 22 states and 3 Union Territories as of June 30, 2026.