Dhanlaxmi Bank delivered exceptional financial performance in the June 2026 quarter, with standalone net profit more than doubling to ₹24.91 crore compared to ₹12.18 crore in the corresponding quarter of the previous year. According to the bank's latest financial results, this represents a remarkable turnaround in the bank's profitability metrics during the first quarter of fiscal year 2026-27. The Board of Directors approved the unaudited financial results at its meeting held on July 29, 2026, with the results subjected to a limited review by Joint Statutory Central Auditors who issued an unmodified report. However, it's worth noting that the Q1 profit of ₹24.9 crore was lower than the ₹43.5 crore reported for the fourth quarter of the last fiscal, indicating some sequential moderation despite the strong year-on-year growth.
The bank's operating profit demonstrated exceptional growth, rising 55% to ₹51.5 crore in Q1 FY27, up from ₹33.3 crore in the same period last year. As reported by the bank, this significant improvement was driven by higher income and lower provisions. Total provisions and contingencies for the quarter stood at ₹15.9 crore against ₹21.1 crore in the previous year, contributing to the strong bottom-line performance. The bank's total income was higher at ₹484.3 crore as compared with ₹407.1 crore while total expenditure was ₹432.8 crore vs ₹373.8 crore, largely due to increased interest expenses and operating costs. The financial results have been arrived at after considering provision for standard assets including requirements for exposures to entities with unhedged foreign currency exposures, provision for non-performing assets, provision for non-performing investments, provision for income tax and other usual and necessary provisions.
The bank's net interest income (NII) climbed 27.2% year-on-year to ₹177 crore from ₹139 crore, demonstrating strong core banking performance. The bank's asset quality metrics showed exceptional improvement with Gross Non-Performing Assets (GNPA) ratio declining dramatically to 1.82% from 3.2% a year ago, representing a significant sequential improvement from 1.89% in March 2026. In absolute terms, gross NPAs stood at ₹286.57 crore while net NPAs were ₹72.61 crore. The provision coverage ratio, including technical write-offs, stood at 92.77%, and the Capital Adequacy Ratio (CAR) under Basel III norms improved to 19.19% from 18.92% in the previous quarter, reflecting a robust capital base. The Earnings Per Share (EPS) for the quarter was ₹0.63, with the return on assets (annualised) at 0.45%.
As of June 30, total business rose 21.13% year-on-year to ₹35,190 crore from ₹29,051 crore as on June 30, 2025, driven by a 17% increase in deposits to ₹19,404 crore from ₹16,570 crore and a 26.47% jump in gross advances to ₹15,786 crore from ₹12,482 crore. The bank also witnessed healthy traction across key lending segments, with CASA deposits growing 19.55% year-on-year to ₹5,591 crore from ₹4,675 crore and retail term deposits reaching ₹10,178 crore from ₹8,580 crore, recording 18.62% growth. Retail Advance (including gold) portfolio grew by 52.87%, with the gold loan portfolio surging 75.91% to ₹7,105 crore. MSME advances rose 29.24% to ₹2,250 crore, reflecting broad-based credit growth. Retail Banking remained the largest contributor to segment revenue at ₹296.70 crore, followed by Treasury at ₹75.75 crore and Corporate/Wholesale Banking at ₹108.71 crore. Retail Banking also delivered the highest segment result at ₹21.80 crore, while Treasury contributed ₹8.90 crore.
Ajith Kumar K K, Managing Director and CEO of the Bank, expressed satisfaction with the quarterly performance, stating that "the Q1 results are encouraging and reflect the sustained efforts made by the Bank over the past few years. I am confident that the total business growth of over 21 per cent achieved during the first quarter will support the bank's strategy of sustainable growth throughout the year". He highlighted that "Our Capital to Risk-Weighted Assets Ratio (CRAR) of 19.19 per cent and Provision Coverage Ratio (PCR) of 92.77 per cent have shown significant improvement over the position as on March 31, reflecting our continued focus on prudent business growth while maintaining strong regulatory compliance". The CEO particularly emphasized "another major achievement during the quarter is the sequential reduction in Gross NPA to 1.82 per cent and Net NPA to 0.47 per cent, underscoring the strength and quality of our advances portfolio".
Despite the strong financial performance and improving balance sheet metrics, shares of Dhanlaxmi Bank came under pressure following the results announcement. Shares were down 5.01% to ₹32.44 apiece on the BSE at the time of reporting, suggesting profit booking after the stock's recent run-up. The strong quarterly performance indicates Dhanlaxmi Bank's successful execution of its business strategy and operational improvements during the first quarter of FY27, with the doubling of net profit despite a modest rise in operating expenses highlighting the impact of reduced credit stress. The bank's operating profit of ₹51.5 crore was higher than the ₹33.3 crore reported in the same quarter last year, demonstrating consistent operational strength across key metrics.
