Aye Finance Q2 Results 2026: PAT jumps 151% to ₹87 cr

Overview

Aye Finance Ltd reported a sharp rise in profitability for the quarter ended September 30, 2026 (Q2FY27), as the MSME-focused lender posted its highest-ever quarterly profit. Profit after tax for the quarter was reported at ₹86.72 crore, which the company and market coverage broadly rounded to ₹87 crore. That compares with ₹34.53 crore (around ₹35 crore) in the same period last year.

The company also filed an investor presentation under Regulation 30 of the SEBI (LODR) Regulations, 2015 on October 21, 2026. Separately, Aye Finance said the audio recording of its earnings conference call held on October 22, 2026 was made available on its website, allowing investors to review management’s commentary on performance and outlook.

Key Q2FY27 numbers at a glance

Total income for the July to September quarter rose to ₹527 crore, up 18.42% year-on-year from ₹445 crore. Revenue from operations was reported at ₹514.39 crore versus ₹434.89 crore a year earlier, reflecting an 18.3% year-on-year increase. Interest income increased to ₹479.26 crore from ₹371.39 crore in Q2FY26.

On the balance sheet side, Assets Under Management (AUM) rose 26% year-on-year to ₹7,597 crore as of September 2026. The company also reported disbursements of ₹1,403 crore in Q2FY27, up 10% year-on-year and 15% quarter-on-quarter.

Profit surge and what the filings attribute it to

The core driver visible in the quarter’s numbers is the improvement in income, led by higher interest income. With total income rising to ₹527 crore and interest income increasing to ₹479.26 crore, the operating engine appears to have strengthened versus the year-ago quarter.

The investor presentation and associated updates also pointed to improving operating metrics, including profitability measures tied to AUM. The company reported Return on AUM (RoAUM) of 4.7% for Q2FY27, up from 2.4% in Q2FY26 and 4.2% in Q1FY27, alongside profit after tax rising 151% year-on-year and 16% quarter-on-quarter.

Net interest margin improved to 15.6%

Aye Finance reported that its net interest margin (NIM) increased to 15.6% in Q2FY27, compared with 13.9% at the end of September 2025. This NIM improvement matters for an NBFC because it indicates a wider spread between the yields earned on the loan book and the cost of funds.

The company’s reported rise in interest income, along with the NIM movement, frames the quarter as one where the lending business generated a stronger core margin profile than the comparable reference point mentioned in filings.

Asset quality signals: credit cost at 3.82%

The company reported that credit cost declined to 3.82% in Q2FY27, improving for the seventh consecutive quarter. It also stated that the credit cost now sits within its guided range of 3.5% to 4.0% for FY27.

A sustained decline in credit cost can support profitability because it reduces the drag from provisions and credit losses. In Aye Finance’s case, the improvement is positioned as a multi-quarter trend rather than a one-off movement.

Operating efficiency: expense ratio at 8.61%

Aye Finance reported an operating expense ratio of 8.61% in Q2FY27, down 32 basis points quarter-on-quarter. The company attributed the movement to better productivity and efficiency.

The investor presentation also described the 8.6% operating expense ratio as the lowest in the last eight quarters. For investors, this is a key operating lever because cost discipline can amplify the benefit of higher income growth.

Funding costs eased; rating upgraded to IND A+

On the liability side, the company reported easing funding costs. It cited an incremental cost of borrowing of 10.04% and a blended cost of 10.63%, down 15 basis points quarter-on-quarter.

The earnings-call highlights also linked the funding-cost improvement to a rating upgrade to IND A+. While the filings do not quantify the full impact of the upgrade, the reported cost-of-borrowing metrics indicate that the company sees tangible benefits on funding.

Disbursement trends and regional moderation

Aye Finance reported that disbursements grew 15% quarter-on-quarter despite moderated lending in drought-affected regions including Maharashtra, Karnataka, and Madhya Pradesh. This detail provides context for the quarter’s business cadence, especially when specific geographies face operating constraints.

The earnings-call highlights also noted that repeat loan disbursements declined 16% year-on-year due to deferment, with an expectation of recovery in Q3. This is an operational datapoint investors may track for understanding momentum in the existing-customer book.

Guidance references cited in the earnings call highlights

According to the Q2FY27 earnings call highlights included in the provided material, AUM growth of 26% year-on-year to ₹7,597 crore was within FY27 guidance of 25% to 30% growth. The same highlights referenced a guided credit-cost range of 3.5% to 4.0%, which aligns with the 3.82% credit cost reported for the quarter.

These references matter because they position the quarter’s performance against disclosed ranges rather than standalone numbers, particularly for AUM growth and credit cost.

Key reported metrics table

Market impact and what investors may track next

The immediate market-relevant takeaway from the filings is that profitability improved sharply alongside reported gains in AUM and margins. Investors tracking NBFCs typically focus on income growth, margins, funding costs, and credit cost trends, and Aye Finance provided updated numbers across each of these lines.

For next steps, the company has already placed supporting material in the public domain: the investor presentation (filed on October 21, 2026 under Regulation 30) and the earnings-call audio recording (uploaded after the October 22, 2026 call). Those documents and discussions are likely to remain the primary sources for tracking how the company explains the quarter’s drivers, including the moderation in certain regions and the trends in repeat disbursements.

Conclusion

Aye Finance’s Q2FY27 update showed profit after tax rising to about ₹87 crore, supported by higher total income of ₹527 crore, interest income of ₹479.26 crore, and AUM growth of 26% to ₹7,597 crore. The company also reported improved operating and credit metrics, including a 15.6% net interest margin, 3.82% credit cost, and an 8.61% operating expense ratio. Investors looking for further detail can refer to the investor presentation filed on October 21, 2026 and the earnings call recording from October 22, 2026 that the company said is available on its website.