Fusion Finance Q1 FY27: PBT up 67%, GNPA at 2.51%

Key takeaways from the June 2026 quarter

Fusion Finance Ltd reported strong results for the quarter ended June 30, 2026 (Q1 FY27), supported by better margins and improving asset quality. The company reported total income of ₹458 crore, up about 7 percent quarter-on-quarter (QoQ). Pre-provision operating profit (PPOP) stood at ₹102 crore, up about 10 percent QoQ.

Profit before tax (PBT) came in at ₹62 crore, rising from ₹37 crore in Q4 FY26, a 67 percent sequential increase. Profit after tax (PAT) was reported at ₹62 crore for the quarter. The company also reported net interest income (NII) of ₹236 crore and a net interest margin (NIM) of 11.93%.

What the company reported in Q1 FY27

The quarter featured a combination of operating improvement and lower credit costs. NIM improved to 11.93% in Q1 FY27, compared to 11.44% in Q4 FY26 and 10.29% in Q1 FY26. The marginal cost of borrowing declined by 246 basis points year-on-year to 10.1%.

On operating profitability, Fusion Finance reported PPOP of ₹102 crore in Q1 FY27, up 18% from ₹87 crore in Q1 FY26 and 10% from ₹93 crore in Q4 FY26. Total income for the quarter was reported at ₹458 crore (Q4 FY26: ₹430 crore). These figures collectively indicate better operating leverage compared with the immediately preceding quarter.

Profit rebound and year-on-year comparison

Fusion Finance reported a net profit of about ₹62.4 crore in the June 2026 quarter, reversing a year-ago net loss of about ₹92.3 crore. The company’s Q1 FY26 profitability was impacted by impairment charges of ₹179 crore, as stated in the provided information.

On the sequential side, PBT increased to ₹62 crore in Q1 FY27 from ₹37 crore in Q4 FY26. The PAT figure for Q1 FY27 was reported at ₹62 crore. The combination of a higher PPOP and lower credit costs supported this improvement.

Asset quality improves as GNPA falls

Asset quality indicators improved during the quarter. Gross non-performing assets (GNPA) declined to 2.51% as of June 30, 2026, from 3.21% in Q4 FY26, described as an improvement of 70 basis points QoQ.

Net NPA was reported at 0.47% in Q1 FY27. The data also highlights that credit cost declined to ₹40 crore in Q1 FY27 from ₹56 crore in Q4 FY26, and this marked the seventh consecutive quarter of reduction.

Disbursements and AUM: growth on a yearly base, mixed sequentially

Fusion Finance disbursed ₹1,783 crore in Q1 FY27, up about 88% year-on-year from ₹950 crore in Q1 FY26. The company attributed the jump in disbursements to a sustained pick-up in business momentum and demand, according to the supplied text.

However, sequentially, disbursements were lower versus Q4 FY26. The metric table provided shows disbursements of ₹1,783 crore in Q1 FY27 versus ₹2,140 crore in Q4 FY26, down 17% QoQ.

Assets under management (AUM) rose to ₹7,702 crore in Q1 FY27 from ₹7,407 crore in Q4 FY26, up about 4% QoQ. Another data point in the input states AUM at ₹7,688 crore as of June 2025 (Q1 FY26).

Capital adequacy, leverage and liquidity position

The company reported a capital to risk (weighted) assets ratio (CRAR) of 36.95% in Q1 FY27. Liquidity was reported at ₹1,880 crore.

The debt-to-equity ratio was stated at 2.3x. These indicators were presented alongside operating performance metrics such as NIM, credit cost, and NPAs.

Summary table: key operational and financial metrics

*PAT for Q4 FY26 is referenced in the provided text as “Net Profit - Last Quarter ₹114.19 Cr” (last updated May 29, 2026).

Market impact: what the numbers signal

The reported improvement in GNPA to 2.51% from 3.21% QoQ, alongside lower credit costs, is a key driver of profitability in the quarter. A higher NIM of 11.93% also contributed to stronger operating performance, particularly when viewed against 10.29% in Q1 FY26.

Operationally, investors often track AUM growth and disbursements as leading indicators for a microfinance-focused lender. In Fusion Finance’s case, AUM rose about 4% QoQ to ₹7,702 crore, while disbursements showed a sharp year-on-year rise but a QoQ decline. The disclosed liquidity of ₹1,880 crore and CRAR of 36.95% provide additional context on balance sheet strength.

Analysis: why this quarter stands out

The quarter is notable mainly for the sharp sequential rise in PBT to ₹62 crore and the reversal from a year-ago loss. The data provided links the year-ago loss to impairment charges of ₹179 crore, while the current quarter’s improvement coincides with declining credit costs and better GNPA.

The NIM trend is another focal point. NIM improved year-on-year (10.29% to 11.93%) and sequentially (11.44% to 11.93%). Alongside a stated 246 basis point year-on-year decline in marginal borrowing cost to 10.1%, the spread performance appears to have strengthened within the disclosed period.

Filing details and what to watch next

The results were filed on August 10, 2026 at 17:19 IST, with the exchange listed as NSE and the category noted as Financial Results, Investor Presentation.

Going forward, future quarters will likely be evaluated on whether the decline in credit costs remains consistent beyond the seventh consecutive quarter noted, and whether disbursements regain sequential momentum while maintaining the improved asset quality metrics reported as of June 30, 2026.