Manappuram Finance Q4: ₹404cr profit, NIM tight in FY26

Stock falls despite a sharp earnings turnaround

Manappuram Finance shares slipped on Tuesday even after the non-bank lender reported a strong turnaround in its March quarter numbers. The stock fell more than 3% intraday to ₹296.70 per share, reflecting continued investor focus on net interest margin (NIM) pressure. The results were announced after market hours on Monday, which set up the next day’s reaction. The fall also came after a strong run in the counter over the past month.

Q4 FY26 numbers: profit rebound and higher operating revenue

For Q4 FY26, Manappuram Finance reported a consolidated net profit of nearly ₹404 crore, versus a net loss of ₹191 crore in Q4 FY25. Sequentially, profit jumped about 68% from ₹241 crore in Q3 FY26. Revenue from operations rose nearly 11% year-on-year to ₹2,614 crore, compared with ₹2,361 crore in the year-ago quarter. The quarter showed a clear recovery on profitability, but broker notes pointed to margin compression as the key near-term overhang.

Dividend announcement alongside results

Along with the Q4 results, the company declared an interim dividend of ₹0.50 per share, described as 25% on a face value of ₹2 per share. Dividends tend to matter for NBFC investors focused on payout consistency, but they did not offset concerns around NIM in the immediate trading response. The declared dividend also sits against a broader set of factors influencing the stock, including changes in business mix and funding conditions.

FY26 full-year picture: profit declines despite Q4 rebound

While the March quarter was strong, the full-year trend remained weaker. For FY26, Manappuram Finance’s consolidated net profit declined over 17% year-on-year to ₹1,003 crore, from ₹1,216 crore in FY25. The split between a better Q4 and a softer full-year number highlights how margin pressure and credit costs through the year continued to weigh on overall profitability.

Bain Capital deal and recent stock run-up

Before Tuesday’s decline, Manappuram Finance shares had gained over 17% in the past month. The move followed Bain Capital’s acquisition of a 41.66% stake in the company and the assumption of joint control. The sharp rally into results raised the bar for what the market wanted from the quarter, and that may have contributed to the post-results softness despite the profit turnaround.

Jefferies: upgrade to Buy as it sees an inflection

Jefferies upgraded the stock to ‘Buy’ from ‘Hold’ and raised its target price to ₹360 per share from ₹285. The brokerage said Q4 net profit beat its estimate and that it sees an inflection ahead. It added that strong loan growth was led by gold loans, and that margins are expected to inch up after bottoming out. Jefferies also noted it was factoring slightly better NIMs and lower operating expenses, and referenced Bain’s capital infusion as EPS-dilutive but modestly book value accretive. It said it raised FY27-28 estimated profit after tax (PAT) by 12-16%, while EPS moves down 5-8%.

Morgan Stanley and Motilal Oswal: mixed views, valuation focus

Morgan Stanley maintained an ‘Equal-weight’ rating with a target price of ₹270 per share, implying downside potential of more than 11% from the stock’s previous closing price, as reported by ET Now. It pointed to a sharp surge in the gold loan business, aided by higher ticket sizes and gold prices, but stayed cautious due to limited visibility in the non-gold business.

Motilal Oswal maintained a ‘Neutral’ rating and raised its target price to ₹315 from ₹290. It said the company delivered a strong performance in the gold loan segment supported by rising gold prices, healthy demand, and a gradual shift in customer preference toward formalised financing. However, it flagged subdued growth in the non-gold portfolio due to ongoing asset quality concerns, even as the vehicle finance (VF) and Asirvad MFI segments showed early signs of improvement. Motilal also highlighted that the stock trades at around 1.6 times estimated FY27 book value following the Q4 results.

What the margin discussion means for the stock reaction

The trading action suggests that the market is not only rewarding the profit rebound, but also re-pricing the durability of earnings. The article’s key tension is between strong gold loan momentum and the drag from yield compression, which directly affects NIM. Jefferies framed FY26 as a period of sharp EPS downgrades driven by NIM compression and elevated credit costs, and argued that NIMs bottoming out and provisions peaking could drive improvement. In contrast, the more cautious broker stance points to uncertainty around non-gold segments and visibility on growth outside gold.

Key numbers at a glance

Conclusion: strong quarter, but investors want clarity on NIM

Manappuram Finance delivered a decisive profit turnaround in Q4 FY26 and reported double-digit growth in revenue from operations. Yet the stock fell as investors stayed focused on NIM pressure and the pace of recovery outside the core gold loan franchise. Brokerages remain split on the risk-reward, with Jefferies turning more constructive while others highlight limited visibility in non-gold portfolios. The next set of updates on margins, credit costs, and segmental growth will likely determine whether the post-Bain rerating sustains.