Shriram Finance delivered exceptional first quarter results for FY2027, with consolidated net profit surging 60% year-on-year to ₹3,445 crore compared to ₹2,154 crore in the corresponding quarter last year. As reported by Business Standard, the earnings comfortably beat Street estimates, with Nomura noting the performance beat estimates by 16% and was broad based with better-than-expected trends on all key lines. The strong performance was supported by robust core income growth, with Net Interest Income (NII) or core income growing 34% from last year to ₹8,056 crore, surpassing the CNBC-TV18 poll estimate of ₹7,375 crore. Revenue from operations advanced 16% annually to ₹13,394 crore from ₹11,536 crore in the year-ago period. Earnings per share (EPS) increased by 29.41% to ₹14.83 as against ₹11.46 recorded in the same period of the previous year, demonstrating the company's continued momentum in the current financial year.
Shriram Finance demonstrated robust business expansion with Assets Under Management (AUM) at ₹3.13 lakh crore during the April-June period, highlighting continued growth in its lending business. According to Business Standard, Total Assets under Management as of June 30 increased by 15.3% and stood at ₹313,798 crores compared to ₹272,249 crores as of June 30, 2025 and ₹302,274 crores as of March 31, 2026. The company's diversified portfolio showed strong performance across segments, with commercial vehicle AUM rising 47% to ₹1.47 lakh crore and passenger vehicle AUM advancing 22% to ₹68,650 crore. However, construction equipment AUM saw a 25% decline during the quarter. This growth trajectory demonstrates the company's ability to maintain and expand its market presence across various business segments.
Shriram Finance achieved significant improvement in its core profitability metrics during Q1 FY2027. As reported by Business Standard, Net Interest Income (NII) rose 33.67% year-on-year and 15.18% quarter-on-quarter to ₹8,055.7 crore, while total income increased 16.21% annually to ₹13,412.11 crore. According to Nomura, net interest margins (NIMs) were up 97bp quarter-on-quarter led by a 51bp expansion in yields (gains from parked funds of MUFG Bank (unlisted)) offsetting 12bp higher cost of funds (due to excess liquidity). The company's net interest margin (NIM) improved to 9.04% from 8.61% in Q4FY6 and 8.11% in Q1FY6, indicating enhanced operational efficiency. Public deposits mobilised by the company rose 14.3% year-on-year to ₹72,070 crore, while funds raised through non-convertible debentures (NCDs) increased nearly 20% year-on-year to ₹39,610 crore, demonstrating the company's successful fundraising capabilities and diversified funding sources.
Shriram Finance demonstrated exceptional strength in its gold loan segment during Q1 FY2027, with gold financing momentum sustaining with 46% year-on-year growth in Q127, accelerating from 37% growth in the previous quarter. As reported by Nomura, the company is disbursing gold loans via 220 branches and wants to double the mix of gold financing over the next three years. The brokerage highlighted continued strength in the gold loan segment as a key positive trend. This robust performance in gold loans, combined with the company's diversified portfolio across commercial vehicles, passenger vehicles, and MSME segments, demonstrates Shriram Finance's successful execution of its lending strategy and ability to maintain strong business momentum across various business verticals.
Shriram Finance's financial strength was further reinforced by significant improvements in its capital adequacy position during Q1 FY2027. As reported by Business Standard, the total capital adequacy ratio (CRAR) improved to 34.17% in the quarter from 20.40% in Q4FY6 and 20.79% in Q1FY6, indicating substantial strengthening of the company's capital base. Shriram Finance shares gained 2.05% to trade at ₹1,025.70 at 12:03 pm today, reflecting robust investor confidence following the strong quarterly results. The stock's positive momentum comes after the company's consistent financial growth trajectory and ongoing corporate activities. Shriram Finance shares succumbed to profit booking after hitting an intraday high of ₹1,051, with the stock falling as much as 3.21% to hit an intraday low of ₹992.90. As of 2:44 pm, Shriram Finance shares traded 2.22% lower at ₹1,002.65, underperforming the NIFTY50 index, which was down 0.41%. The stock made an intraday high of ₹1,051 after the results announcement but later gave up all gains, currently trading 0.3% higher at ₹1,029.7.
Following the strong quarterly results, ICICI Securities has issued a bullish recommendation on Shriram Finance, recommending a 'Buy' rating with a target price of ₹1,225 in its research report dated July 25, 2026. As reported by Moneycontrol, the brokerage noted that Q1FY27 AUM grew 15.3% YoY to ₹3,138.0 billion, led by healthy growth across commercial vehicles, passenger vehicles, farm equipment and gold portfolios. ICICI Securities expects reported NIM to expand driven by improved yields, with NIM expected to trend at 9.7% in FY28E. The brokerage highlighted that headline asset quality saw a slight deterioration due to seasonality, but provision buffers remain healthy at ~6% of the loan book. ICICI Securities projects credit cost of 2.0%/1.9% in FY27/FY28E and has tweaked FY27/FY28E estimates upwards on better margin, positive growth outlook and controlled credit cost. The brokerage maintains its 'BUY' with an unchanged multiple of 2.25x on FY27E BV, noting that management expressed confidence in achieving ~18% growth in FY27 and believes SFL is well positioned to emerge as a dominant leader in the NBFC space over the next five years, underpinned by structurally superior profitability and robust operational scale.
During the quarter, Shriram Finance completed a landmark strategic expansion through MUFG Bank, the Japanese banking giant and subsidiary of Mitsubishi UFJ Financial Group, completing its acquisition of a 20% equity stake in Shriram Finance, making it the largest cross-border investment in India's financial services sector. The Mumbai-based company's diversified portfolio continues to show strong performance across segments, with the commercial vehicle segment leading growth at 47%, followed by passenger vehicles at 22% and interest income driven by robust growth of 45% in gold loans. Looking ahead, Nomura highlighted that management is watching out for monsoon trends and noted lower rainfall in Karnataka, Madhya Pradesh, Chhattisgarh. The company has guided for 15% AUM growth in Q227F and, depending on monsoon trends may grow faster in 2H27F. Nomura maintained its 'Buy' rating with an unchanged target price of ₹1,200, noting that given higher liquidity and faster scale up of new vehicle book, we revise net profit estimates by +6% to -7% over FY27-29F. The brokerage emphasized that monsoon trends will be key to any revision in the company's growth guidance, with management maintaining its 2% credit cost guidance for FY27F.
