Finance company Northern Arc Capital announced Q2FY26 results Net Interest Income grew by 12% YoY & 8% QoQ to Rs 322 crore in in Q2FY26. NIM improved by 37 bps QoQ to 9.3% in Q2FY26. Fee & Other income was Rs 21 crore in Q2FY26. Opex ratio of 3.7% in Q2FY26. PPoP of Rs 213 crore in Q2FY26. croreedit cost improved QoQ to Rs 92 crore for Q2FY26 compared to Rs 102 crore in Q1FY26. Profit after tax increased by 13% QoQ to Rs 92 crore in Q2FY26 compared to Rs 81 crore in Q1FY26. Return on Assets increased by 20 bps QoQ to 2.6% for Q2FY26. Return on Equity was 10.1% for Q2FY26. Assets & Flows: Gross transaction volumes increased by 19% QoQ to 8,787 crore. Lending AUM grew by 15% YoY & 6% QoQ to Rs 14,166 crore as on September 30, 2025. Share of Direct to Customer (D2C) lending in AUM increased to 54%. Excluding rural finance, where exposure remains calibrated, D2C AUM grew 32% YoY to Rs 6,718 crore. Performing croreedit Fund AUM grew by 14% YoY to Rs 3,198 crore as on September 30, 2025. Placement volumes for H1FY26 were Rs 5,399 crore Asset quality: Gross NPA ratio was 1.15% as on September 30, 2025. Net NPA ratio was stable QoQ at 0.56% as on September 30, 2025. Provisioning coverage ratio on Stage III assets was 52% on September 30, 2025 Capital Adequacy: Capital adequacy ratio was 24.6% on September 30, 2025. Ashish Mehrotra,MD & CEO, said: “We are witnessing early signs of a credit revival, supported by the repo rate cuts earlier this year and the Government’s recent stimulus through GST rate reductions. A normal monsoon is expected to further strengthen rural demand and stability. We are confident that these measures and developments will lead to better credit uptake in second half of this year. Coming to Northern Arc Capital’s performance, our AUM grew 15% YoY and 6% QoQ to Rs 14,166 crore. The D2C AUM grew 17% YoY, and excluding rural finance — where exposure remains calibrated — D2C AUM growth stood at a strong 32% YoY. croreedit cost improved to 2.7% from 3.0% in Q1FY26, driven by a revival in consumption trends and an improving economic environment, which strengthened collections in the Consumer Finance segment. We also saw a decline in MFI provisions, supported by portfolio calibration and the fact that 80% of the MFI book now comprises loans originated post the MFIN guardrails, with 40% covered under croreedit Guarantee Fund for Micro Units (CGFMU) given all new origination since Mar-25 is covered under CGFMU. These measures, along with our focus on sustainable lending and long-tenured retail products, are expected to help stabilize delinquencies. With these positive trends, we remain confident of achieving our guided AUM growth of 18–20% and RoA of around 2.8% for FY26." Result PDF