Repco Home Finance Q4 FY26: GNPA 2.55%, 75% Dividend

Key takeaways from the Q4 FY26 update

Repco Home Finance Ltd (NSE: REPCOHOME, BOM: 535322) reported improved asset quality and steady core profitability metrics for the quarter and year ended March 2026, as discussed in its earnings call dated May 22, 2026. Gross non-performing assets (GNPA) reduced to 2.55% from 3.26% a year earlier, alongside a drop in the absolute GNPA amount. Management also highlighted record disbursements for the year and reiterated targets for the coming year, even as the loan book growth lagged disbursement growth due to elevated prepayments and pre-closures.

Q4 FY26 profit and revenue snapshot

For Q4 FY26, the company reported standalone net profit of INR 129 crore, compared with INR 125 crore in Q4 FY25 and INR 109 crore in Q3 FY26. On a consolidated basis, Q4 net profit stood at INR 135 crore versus INR 130 crore in Q4 FY25. Consolidated revenue for the quarter was reported at INR 450 crore, up from INR 430 crore in the year-ago period. Separately, net interest income for Q4 was reported at INR 207 crore, up 16% year-on-year.

Profitability metrics: NIM, spread, and costs

Repco Home Finance reported a net interest margin (NIM) of 5.38% compared with 5.15% previously. Management said the company maintained a healthy spread of 3.30% during the period. The cost of funds was indicated at 8.56% and yield on advances at about 11.9%, supporting the spread profile. Cost-to-income ratio was reported at 28.71, based on the earnings call commentary.

Disbursements hit record levels, led by Tamil Nadu

The company said disbursements improved quarter-on-quarter and year-on-year, with Q4 disbursements of INR 1,186 crore (management also referenced the March quarter as around INR 1,180 crore in the call). Total disbursements for FY26 were reported at INR 4,148 crore, described as the highest annual disbursement for Repco Home Finance. In FY25, disbursements were INR 3,284 crore, and management stated FY26 disbursements rose 26%.

On geographic mix, Tamil Nadu remained the largest contributor. Management said almost 60% of disbursements in the last quarter came from Tamil Nadu, while Karnataka, Maharashtra, Telangana and Madhya Pradesh showed improvement from December to March.

Loan book grows, but prepayments stay elevated

Repco Home Finance reported its overall loan book at INR 15,880 crore as of March 31, 2026, up 9.6% from INR 14,492 crore a year earlier (management also referenced INR 14,496 crore in commentary). Management flagged that loan book growth was significantly below disbursement growth, primarily due to high prepayments and pre-closures. The company also noted that prepayments were particularly high among non-salaried customers, who tend to prepay when surplus cash flows arise.

In addition, Repco Home Finance said it faced a reduction in interest income of INR 11.53 crore due to a change in interest calculation methods.

Asset quality improves as GNPA declines

Asset quality improved during FY26, with gross NPA reducing to INR 405 crore (2.55%) from INR 473 crore (3.26%) in the previous year. Management also reiterated its intent to reduce NPAs and Stage 2 assets further, as part of its broader operating guidance.

Dividend raised to 75% for FY26

The company declared a total dividend of 75% for the financial year. Management said an interim dividend of 45% had already been declared, and the board subsequently declared a 30% final dividend subject to shareholder approval, taking the total to 75%. Separately, the company also reported an interim dividend of INR 2 per share for FY2025-26 with a record date of February 12, 2026, linked to the unaudited Q3 and 9M 2025 results announcement.

Balance transfers and principal rundown: management commentary

Management said it was taking steps to control balance transfer (BT) outflows, indicating BT outflows were under control at about INR 30-35 crore per month. The CFO stated that for the year, BT out was approximately INR 400 crore, with the rest comprising regular repayments and prepayments. The principal rundown was about INR 2,670 crore, with scheduled repayments of around INR 700 crore.

The earnings call also referenced BT out and BT in dynamics, with monthly BT out of about INR 35-36 crore and BT in of about INR 45-50 crore, translating into a net monthly gain of roughly INR 15-20 crore.

Guidance and targets: disbursements and AUM trajectory

The CEO stated the company is targeting disbursements of approximately INR 5,000 crore for the year, with an expected year-end loan book (AUM) of about INR 18,000 crore. Management indicated it expects to reach the INR 25,000 crore target in about three years, while acknowledging a slight delay from the original timeline. In other stated targets, management had also referenced guidance for INR 4,000 crore disbursements in FY26 and AUM of INR 16,200 crore, and has spoken about a forward disbursement target of INR 5,000 crore in FY27.

Summary table: reported numbers and management targets

Why this update matters for investors

The combination of improving GNPA and stable NIM is central for a housing finance company operating with a meaningful share of non-salaried borrowers. At the same time, Repco Home Finance’s commentary shows that strong disbursement momentum does not automatically translate into comparable loan book growth when prepayments and pre-closures are elevated. The company’s focus on managing BT outflows and maintaining underwriting quality is positioned as a practical response to these balance sheet headwinds.

Conclusion

Repco Home Finance ended FY26 with higher disbursements, improved asset quality, and a 75% total dividend, while highlighting the drag from prepayments on loan book growth. Management’s near-term focus remains on scaling disbursements to around INR 5,000 crore and building AUM to about INR 18,000 crore, alongside continued reduction in NPAs and Stage 2 assets.