CSL Finance Q2 profit rises to Rs 24.9542 crore as income grows

CSL Finance Limited reported profit after tax of Rs 24.9542 crore for the quarter ended September 30, 2026, up 2.04% from Rs 24.4559 crore a year earlier, as interest income rose 18.39% to Rs 70.1009 crore. Higher finance costs, impairment charges and tax expense tempered the increase in net profit.

How did CSL Finance's September-quarter profit change?

CSL Finance's profit after tax rose to Rs 24.9542 crore in the quarter ended September 30, 2026, from Rs 24.4559 crore in the corresponding 2025 quarter. Profit before tax increased 21.32% to Rs 35.0062 crore from Rs 28.855 crore, while total income grew 21.19% to Rs 77.3544 crore from Rs 63.8273 crore.

The larger increase in pre-tax profit than in profit after tax coincided with income-tax expense rising to Rs 10.052 crore from Rs 4.3991 crore a year earlier. Basic earnings per equity share increased to Rs 10.95 from Rs 10.73, while diluted earnings per share rose to Rs 10.87 from Rs 10.65. The board approved the unaudited results on November 2, 2026, after Audit Committee review, and S.R. Dinodia & Co. LLP issued a limited-review report.

For the half year ended September 30, 2026, CSL Finance reported profit after tax of Rs 47.1012 crore, compared with Rs 45.7732 crore in the corresponding half year of 2025. Half-year total income reached Rs 147.7004 crore versus Rs 123.4177 crore, and profit before tax was Rs 64.706 crore compared with Rs 56.4293 crore.

What drove CSL Finance's income growth in the quarter?

CSL Finance's income expansion was led by interest income of Rs 70.1009 crore in the September 2026 quarter, compared with Rs 59.2098 crore a year earlier. Interest income represented about 90.6% of total income of Rs 77.3544 crore, based on the reported standalone figures, and its increase of Rs 10.8911 crore exceeded the overall increase in total income.

Fees and commission income rose to Rs 3.6615 crore from Rs 2.4748 crore, while other income increased to Rs 57.02 lakh from Rs 16.09 lakh. Bad-debt recoveries declined to Rs 1.4398 crore from Rs 1.9818 crore. CSL Finance also recorded a Rs 1.582 crore net gain on derecognition of financial instruments under the amortised-cost category, against Rs 5 lakh in the year-earlier quarter.

The reported results also show total revenue from operations of Rs 76.7842 crore, up from Rs 63.6664 crore in the September 2025 quarter. Revenue from operations includes interest income, fees and commission income, the derecognition gain and bad-debt recoveries, while other income added Rs 57.02 lakh to arrive at total income.

How did costs and impairment affect CSL Finance's results?

CSL Finance's finance costs increased to Rs 24.1596 crore in the September 2026 quarter from Rs 20.7993 crore a year earlier, a 16.16% rise. Impairment on financial instruments more than doubled to Rs 4.0379 crore from Rs 1.8412 crore, an increase of 119.31%, making impairment a significant offset to higher lending income.

Employee-benefit expenses increased to Rs 8.7569 crore from Rs 8.0037 crore, and other expenses rose to Rs 4.4609 crore from Rs 3.6214 crore. Depreciation, amortisation and impairment was Rs 61.02 lakh, compared with Rs 53.64 lakh. Total expenses consequently rose 21.08% to Rs 42.3482 crore from Rs 34.9723 crore.

The tax charge also changed the conversion of operating gains into reported profit. Income-tax expense increased by Rs 5.6529 crore year on year, comprising current tax of Rs 9.1616 crore and deferred tax of Rs 89.04 lakh in the September 2026 quarter, compared with current tax of Rs 7.5177 crore and a deferred-tax credit of Rs 3.1186 crore a year earlier.

What funding and loan-transfer disclosures did CSL Finance make?

CSL Finance said it issued rated, listed, senior, secured, redeemable and taxable non-convertible debentures worth Rs 60 crore during the quarter ended June 30, 2026. The funding consisted of two Rs 30 crore tranches allotted on April 28, 2026 and May 21, 2026, each carrying an annual coupon rate of 11% payable quarterly.

The first tranche is redeemable on April 28, 2028 and the second on May 21, 2028. CSL Finance said the Rs 60 crore proceeds had been fully utilised, with no deviation or variation from the objects of the issue. It also disclosed security over loan receivables of 1.25 times the outstanding amount including accrued coupon as at September 30, 2026.

Separately, CSL Finance transferred loans not in default amounting to Rs 23.1686 crore during both the September 2026 quarter and the half year ended September 30, 2026. The transferred pool had a weighted-average maturity of 2.67 years, a weighted-average holding period of 0.86 years, retention of beneficial economic interest of 10%, and tangible security coverage of 2.15 times; no loans were acquired in the period.

What do CSL Finance's project-finance disclosures show?

CSL Finance reported 127 projects under implementation with position outstanding of Rs 1,030.39 crore at September 30, 2026. This was higher than Rs 936.84 crore across 127 accounts at the beginning of the quarter, after it sanctioned 27 projects with position outstanding of Rs 228.32 crore during the quarter.

Eight projects with Rs 17.64 crore of position outstanding achieved their date of commencement of commercial operations, or DCCO, during the quarter. Nineteen opening accounts with Rs 68.94 crore of position outstanding closed, while net repayments, after further disbursements, amounted to Rs 48.19 crore.

CSL Finance reported no accounts where a resolution process involving extension of the original or extended DCCO had been invoked as of September 30, 2026. It likewise reported no resolution plans implemented, under implementation or failed in those categories, in its disclosure under the Reserve Bank of India Project Finance Directions, 2025.

Conclusion

CSL Finance increased September-quarter profit after tax to Rs 24.9542 crore as interest income added Rs 10.8911 crore year on year and total income reached Rs 77.3544 crore. Finance costs rose by Rs 3.3603 crore, impairment increased by Rs 2.1967 crore and the tax expense rose by Rs 5.6529 crore, which limited the increase in reported net profit relative to pre-tax profit.

The next disclosed milestones are the scheduled redemption dates of the two Rs 30 crore debenture tranches on April 28, 2028 and May 21, 2028. Investors can also monitor subsequent disclosures on the Rs 1,030.39 crore projects-under-implementation position, including whether any accounts enter a DCCO-extension resolution process.