Aditya Birla Capital: Strong Q3 FY26 Driven by Diversified Growth and Digital Prowess

Aditya Birla Capital Limited (ABCL) has delivered a robust performance in the third quarter of Fiscal Year 2026, showcasing significant growth across its diversified financial services platform. The company reported a consolidated revenue of ₹14,181 crore, marking a substantial 30% year-on-year increase. This impressive top-line growth translated into a 41% surge in consolidated profit after tax (excluding exceptional and one-off items), reaching ₹983 crore. The results underscore ABCL's strategic focus on leveraging data, digital capabilities, and technology to drive quality and profitable growth amidst a challenging external economic environment.

The lending businesses, comprising NBFC and Housing Finance, were key drivers of this strong performance. The total lending portfolio expanded by 30% year-on-year and 7% sequentially, reaching ₹1,90,386 crore as of December 31, 2025. The NBFC portfolio alone grew by 24% year-on-year to ₹1,48,182 crore, with profit before tax increasing by 29% year-on-year to ₹1,036 crore. Asset quality in the NBFC segment remained strong, with gross stage 2 and 3 ratios improving by 145 basis points year-on-year to 2.80%. Management highlighted a recalibration of personal consumer and unsecured business segments in earlier quarters, which has now led to strong growth momentum.

Housing Finance Secures Growth Capital

Aditya Birla Housing Finance Limited (ABHFL) had a landmark quarter, securing a primary capital infusion of ₹2,750 crore from Advent International. This transaction values ABHFL at ₹19,250 crore on a post-money basis, reinforcing its position as one of India's fastest-growing Housing Finance Companies (HFCs). ABHFL's portfolio grew by an impressive 58% year-on-year and 10% sequentially to ₹42,204 crore. Disbursements reached an all-time high of ₹6,165 crore, up 30% year-on-year. The company's asset quality remains best-in-class, with gross stage 3 ratio at 0.54%. The RoA for ABHFL increased to 1.96%, reflecting benefits from operating leverage and strong AUM growth. This capital infusion is expected to sustain growth momentum and increase market share for the next 2 to 2.5 years.

Diversified Business Performance

The Asset Management Company (AMC) also demonstrated robust performance, with mutual fund quarterly average AUM growing 15% year-on-year to ₹4,43,233 crore, maintaining an equity mix of 45%. Profit before tax for the AMC business increased by 19% year-on-year to ₹358 crore. The Passives business within AMC gained strong momentum, with QAAuM at ₹38,600 crore, up 28% year-on-year. The company's real estate business also built momentum, with a portfolio of ₹700 crore, reflecting 44% year-on-year growth.

In the insurance sector, both life and health segments showed strong growth. The life insurance business reported a 19% year-on-year growth in individual first-year premium to ₹3,076 crore for 9M FY26. The net value of new business (VNB) margin expanded by 380 basis points year-on-year to 14.6%. The health insurance business saw its gross written premium grow by 39% year-on-year to ₹4,651 crore for 9M FY26, with market share increasing by 210 basis points year-on-year to 14.2%. The combined ratio for health insurance improved to 111% from 114% in 9M FY25, indicating improved profitability despite the impact of new labor codes and GST.

Digital Transformation and Omnichannel Strategy

ABCL's commitment to digital transformation and an omnichannel architecture is yielding significant results. The D2C platform, ABCD, has recorded approximately 9.3 million customer acquisitions and offers a comprehensive portfolio of over 26 products and services. The integrated B2B platform for MSMEs, Udyog Plus, has scaled significantly with 2.4 million registrations and crossed ₹5,000 crore in AUM. These platforms, along with the STELLAR B2D app for channel partners, provide complete flexibility to customers and partners.

Digital adoption metrics are impressive across the NBFC business, with 93% of customer onboarding and 98% of EMI collections being digital. AI-enabled co-pilots across sales, underwriting, customer service, and audit have led to a 1.3x increase in sales manager productivity. The company's 'Health First' data-driven model in health insurance is resonating with consumers, with ~40% engaging for health and 9.9% earning health-based incentives, leading to lower loss ratios and improved persistency.

Outlook and Strategic Focus

Aditya Birla Capital is well-positioned for sustained growth, with management guiding for individual FYP to grow at a CAGR of 20%+ over the next three years and VNB margins to expand above 18%. The NBFC loan book is targeted to double in three years, implying a 25% growth rate. The company continues to focus on strengthening its balance sheet, improving asset quality, and leveraging its proprietary digital platforms to enhance direct sourcing and customer engagement. Proactive risk management and a diversified product portfolio are expected to support future profitability and market share gains.