Shriram Finance's shares dropped more than 6% after the company announced its financial results for the second quarter of the 2026-27 fiscal year (Q2 FY27). The decline was mainly due to concerns about the company's asset quality and higher credit costs. However, the company reported strong growth in key earnings metrics such as profit, net interest income, and assets under management.
- Profit after tax rose 59.37% year-on-year to ₹3,677.03 crore in Q2 FY27.
- Net interest income increased by 38.20% year-on-year to ₹8,661.04 crore.
- Assets under management grew 16.96% year-on-year to ₹3.29 lakh crore.
- Gross non-performing assets slightly increased to 4.65%, while net non-performing assets improved to 2.31%.
- The board declared an interim dividend of ₹6.50 per equity share for FY27.
Why Did Shriram Finance Shares Fall After Q2 Results?
The shares of Shriram Finance fell over 6% due to investor concerns about the company’s asset quality. The gross non-performing assets (GNPA) rose slightly from 4.64% to 4.65% quarter-on-quarter. Elevated credit costs also worried investors, as the company expects these costs to remain high for another quarter or two before returning to normal levels. The management attributed the rise in credit costs to agricultural stress caused by deficient rains and seasonal factors in certain regions. They emphasized that the issue is temporary and limited to select products.
How Did Shriram Finance Perform Financially in Q2 FY27?
Shriram Finance showed strong financial growth in Q2 FY27. Its standalone profit after tax (PAT) increased by 59.37% year-on-year to ₹3,677.03 crore. Net interest income (NII) rose 38.20% to ₹8,661.04 crore. The company’s total assets under management (AUM) grew 16.96% year-on-year to ₹3.29 lakh crore as of September 30, 2026. These figures indicate robust business growth despite challenges in asset quality.
What Dividend Did Shriram Finance Declare?
The board of directors declared an interim dividend of ₹6.50 per equity share, with a face value of ₹2 each, which amounts to a 325% dividend for FY27. The record date for the dividend was set as October 29, 2026, and the payment date was scheduled for November 20, 2026.
What Is the Company’s Outlook for FY27?
Shriram Finance’s management provided a cautious outlook for the rest of FY27. They expect assets under management to grow by 15-17%, despite a 9% year-to-date increase. The company also anticipates that net interest margins (NIMs) will remain elevated in the near term due to an equity buffer before normalizing. The elevated credit costs are expected to continue temporarily but should improve as the agricultural stress eases.
Frequently Asked Questions
Q: What caused the increase in Shriram Finance’s credit costs?
A: The increase was mainly due to agricultural stress caused by deficient rains in certain areas, worsened by seasonal factors. The issue is limited to select products and is expected to be temporary.
Q: How much did Shriram Finance’s profit grow in Q2 FY27?
A: The company’s standalone profit after tax grew by 59.37% year-on-year to ₹3,677.03 crore.
Q: What dividend did Shriram Finance announce for FY27?
A: The board declared an interim dividend of ₹6.50 per equity share, which is 325% of the face value of ₹2 per share.
Q: What is the outlook for Shriram Finance’s asset growth?
A: The company expects assets under management to grow by 15-17% for FY27.
As of October 26, 2026, Shriram Finance had a market capitalization of ₹1.93 lakh crore, reflecting its significant presence in the financial sector.
