Arman Financial Q2 profit rises sixfold as impairment falls

Arman Financial Services Limited reported consolidated profit of Rs 51.48 crore for the quarter ended September 30, 2026, compared with Rs 7.99 crore a year earlier, as impairment losses declined to Rs 25.85 crore from Rs 38.27 crore despite higher finance and operating costs. The results were approved on November 4, 2026.

How did Arman Financial's Q2 profit change?

Arman Financial's profit for the quarter ended September 30, 2026 rose to Rs 51.48 crore from Rs 7.99 crore in the quarter ended September 30, 2025, while profit before tax increased to Rs 69.16 crore from Rs 17.94 crore. The company reported no exceptional items in either quarter, so the reported movement in pre-tax profit reflected income and expense lines.

The quarterly comparison shows total income of Rs 234.64 crore in the September 2026 quarter, against Rs 159.21 crore a year earlier, while total expenses were Rs 165.49 crore compared with Rs 141.27 crore. Finance cost rose, but the fall in impairment losses and the increase in income coincided with the higher reported profit.

Basic earnings per share, not annualised, were Rs 48.94 in the September 2026 quarter, compared with Rs 7.62 a year earlier. Diluted earnings per share were Rs 48.85, against Rs 7.55, while paid-up equity share capital was reported at Rs 10.55 crore at September 30, 2026.

What drove Arman Financial's September-quarter earnings increase?

Arman Financial's September-quarter earnings increase coincided with lower impairment losses and higher total income. Interest income rose to Rs 206.20 crore from Rs 138.25 crore for the quarter ended September 30, 2026, while impairment losses declined to Rs 25.85 crore from Rs 38.27 crore in the corresponding quarter of 2025.

Other operating-income lines also increased during the quarter. Fees and commission income rose to Rs 11.62 crore from Rs 6.71 crore, net gain on fair-value changes was Rs 3.74 crore against Rs 2.17 crore, and gain on assignment of financial assets was Rs 13.08 crore versus Rs 12.08 crore. Total revenue from operations consequently reached Rs 234.64 crore from Rs 159.21 crore.

The lower impairment charge was accompanied by higher costs. Finance cost rose to Rs 73.17 crore from Rs 49.61 crore, employee benefits expense increased to Rs 41.80 crore from Rs 36.44 crore, and other expenses reached Rs 24.00 crore from Rs 16.50 crore. Depreciation and amortisation expense was Rs 65.72 lakh, compared with Rs 45.37 lakh in the prior-year quarter.

How did Arman Financial perform in the first half?

Arman Financial reported first-half profit of Rs 96.65 crore for the half year ended September 30, 2026, while the corresponding prior-year half year showed a consolidated loss of Rs 6.59 crore. First-half profit before tax was Rs 126.32 crore, compared with Rs 6.77 crore a year earlier, after total income rose to Rs 436.46 crore from Rs 310.21 crore.

First-half impairment losses fell to Rs 45.35 crore from Rs 104.79 crore, while finance cost increased to Rs 137.45 crore from Rs 101.84 crore. Interest income grew to Rs 389.16 crore from Rs 278.01 crore, and gain on assignment of financial assets rose to Rs 20.42 crore from Rs 15.49 crore.

The consolidated balance sheet showed loans of Rs 2,610.49 crore at September 30, 2026, compared with Rs 2,213.47 crore at March 31, 2026. Borrowings other than debt securities increased to Rs 1,277.33 crore from Rs 921.46 crore, while debt securities were Rs 848.90 crore versus Rs 844.26 crore.

Total assets were Rs 3,275.08 crore at September 30, 2026, up from Rs 2,797.81 crore at March 31, 2026. Cash and cash equivalents increased to Rs 188.36 crore from Rs 87.78 crore, while investments declined to Rs 59.37 crore from Rs 92.46 crore over the same six-month period.

What do Arman Financial's loan transfer disclosures show?

Arman Financial transferred 51,319 loans through direct assignment during the half year ended September 30, 2026, with a book value of Rs 353.51 crore and sale consideration of Rs 305.72 crore. The group reported eight transactions, a weighted average remaining maturity of 19.48 months and retention of beneficial economic interest of 10%.

For the September 2026 quarter alone, direct assignments covered 34,406 loans with a book value of Rs 235.89 crore and sale consideration of Rs 199.86 crore across three transactions. The weighted average holding period after origination was 4.56 months for the quarter, compared with 4.52 months for the half year.

The filing states that Arman Financial did not acquire loans through assignment, did not transfer non-performing assets and did not acquire stressed loans during the disclosed period. It also says no resolution plans were implemented during the half year for projects financed on or after October 1, 2025, under the cited Reserve Bank of India notification.

The consolidated group comprises Arman Financial and wholly owned subsidiary Namra Finance Limited. Namra Finance's pre-consolidation quarterly profit after tax was Rs 33.82 crore, and its interim financial information was reviewed by other auditors as part of the limited-review process.

Conclusion

Arman Financial's September-quarter result combined higher interest-led income with lower impairment losses: total income rose to Rs 234.64 crore and impairment losses fell to Rs 25.85 crore, producing consolidated profit of Rs 51.48 crore. The first-half figures also show loans increasing from Rs 2,213.47 crore at March 31, 2026 to Rs 2,610.49 crore at September 30, 2026.

The filing discloses no future profit target or business plan. The next results will show whether impairment losses, finance costs and loan growth continue to move from their September 2026 levels, and whether any resolution plans emerge for projects financed on or after October 1, 2025 after none had been implemented by September 30, 2026.