Tata Capital (TATACAP) Q2 25/26 earnings summary

Executive summary

• Achieved 22% YoY and 4.1% sequential AUM growth (excluding Motors/Motor Finance); consolidated AUM at ₹2,43,896 Cr, up 2.7% sequentially after Motors Finance acquisition in May 2025.

• Profit after tax excluding Motor Finance was ₹1,128 Cr, up 33% YoY and 10% QoQ; including Motor Finance, PAT was ₹1,097 Cr, up 10.9% QoQ.

• Strong digital transformation: 97% digital onboarding, 99% digital collections, and significant AI-led initiatives.

• IPO and rights issue strengthened capital adequacy to 21.5% and reduced leverage to 4.9x–5x.

• Customer franchise reached 7.7 million with 1,479 branches across 27 states/UTs.

Financial highlights

• Consolidated net profit for Q2 FY26 was ₹1,097.32 crore, with half-year net profit at ₹2,087.21 crore.

• Net interest income excluding Motor Finance grew 23% YoY to ₹2,637 Cr; including Motor Finance, it was ₹3,003 Cr, up 5% QoQ.

• Cost to income ratio improved to 36.6% (excl. Motor Finance), 39.7% (incl. Motor Finance); expected to fall to 39% for FY26.

• Cost of funds declined to 7.4%, down 47 bps YoY.

• Net NPA stable at 0.6% (excl. Motor Finance); gross NPA at 1.6% (excl. Motor Finance), 2.2% (consolidated).

Outlook and guidance

• FY26 AUM growth guidance: 22%-25% (excl. Motor Finance), 18%-20% (consolidated).

• Credit costs expected at 1%-1.1% (excl. Motor Finance), 1.2% (consolidated).

• FY26 ROA: 2.2–2.3% (excl. Motor Finance), 2.0–2.1% (incl. Motor Finance); ROE: 14–15% (excl. Motor Finance), 13–14% (incl. Motor Finance).

• PAT growth guidance: 32–35%; three-year guidance: AUM CAGR 23%-25%, cost to income 33%-34%, credit costs below 1%, ROA 2.5%-2.7%.