Shares of Equitas Small Finance Bank surged 7% to ₹72.90 during Monday's trading session following the lender's announcement of exceptional fourth-quarter earnings for FY26. According to reports from The Economic Times, the significant stock movement reflects strong investor confidence in the bank's robust financial performance and growth trajectory.
The bank posted a net profit of ₹213 crore in Q4FY26, marking a 406% increase compared to ₹42 crore in the same period last year. As reported by BW Online, this substantial profit growth was driven by robust loan growth, improved margins and lower credit costs. The strong performance demonstrates the bank's operational efficiency and market positioning during the quarter.
Pre-provision operating profit rose nearly 30% year-on-year to ₹403 crore, up from ₹311 crore, while provisions declined significantly to ₹124 crore from ₹258 crore a year earlier. According to BW Online, net income rose 18% year-on-year and 9% sequentially during the quarter, with net interest margin (NIM) improving to 7.29%. The cost of funds declined by 19 basis points quarter-on-quarter to 6.94%, aiding profitability.
The bank recorded its highest-ever quarterly disbursements at ₹7,347 crore, reflecting a 72% jump year-on-year and 12% rise quarter-on-quarter. As reported by BW Online, gross advances grew 22% year-on-year and 7% sequentially, supported by growth in non-microfinance segments such as housing finance, micro and small enterprise (MSE) loans and gold loans. The gold loan portfolio crossed ₹850 crore during the quarter, with small business loans growing 13% annually and secured business lending expanding 27%.
Asset quality strengthened significantly during the quarter, with gross non-performing assets (GNPA) declining to 2.49% from 2.62% in the preceding quarter, while net NPAs fell to 0.68% from 0.88%. According to BW Online, credit cost declined to 1.11% in Q4FY26, compared with 1.88% in Q3FY26 and 2.74% in Q4FY25. The cost-to-income ratio improved to 67.52% from 72.96% in the December quarter, reflecting better operational efficiency. The bank maintained strong capital adequacy with net worth at ₹6,125 crore and a capital adequacy ratio (CRAR) of 20.31% as of March 31, 2026, including Tier I capital of 16.68%.
