Tata Capital (TATACAP) Q3 25/26 earnings summary

Executive summary

• Achieved highest-ever quarterly AUM growth, with net AUM excluding Motor Finance at ₹2,34,114 Cr (up 26% YoY, 9% QoQ); including Motor Finance, AUM at ₹2,60,698 Cr (up 7% QoQ), driven by festive demand, GST reduction, and robust retail, SME, and housing finance performance.

• Profit after tax excluding Motor Finance rose 39% YoY to ₹1,285 Cr (14% QoQ); including Motor Finance, PAT was ₹1,290 Cr (18% QoQ), with stable asset quality and improved operating metrics.

• Digital transformation and AI adoption enhanced efficiency, with 97% of customers digitally onboarded and 99% of collections through digital channels.

• Unaudited standalone and consolidated financial results for the quarter and nine months ended December 31, 2025, were approved, reflecting the amalgamation of Tata Motors Finance Limited (TMFL) and successful IPO completion.

• Retail and SME segments constitute ~87% of Net AUM; unsecured retail loans form 10.4% of Net AUM.

Financial highlights

• Net interest income (excl. Motor Finance) was ₹2,936 Cr, up 26% YoY; including Motor Finance, ₹3,315 Cr, up 10% QoQ.

• Standalone Q3 FY26 revenue from operations: ₹5,783.28 Cr (up from ₹5,367.74 Cr YoY); consolidated Q3 FY26 revenue: ₹7,975.44 Cr (up from ₹7,103.61 Cr YoY); consolidated net profit attributable to owners: ₹1,256.87 Cr (up from ₹1,075.57 Cr YoY).

• Cost-to-income ratio improved to 35.7% (excl. Motor Finance) and 38.4% (incl. Motor Finance); capital adequacy at 20.3%, net worth at ₹43,153 Cr, and liquidity buffer of ₹34,888 Cr.

• Debt-to-equity ratio reduced to 5.1x (consolidated), standalone at 3.95x (down from 5.40x YoY).

• IPO of 47.58 crore shares in October 2025 raised ₹6,846 Cr, with all proceeds utilized as planned.

Outlook and guidance

• On track to meet FY26 guidance: AUM growth 18-20% (incl. Motor Finance), credit cost ~1.2%, cost to income 38-39%, ROA 2.0-2.1%, ROE 13-14%.

• FY28 guidance: AUM CAGR 23-25%, PAT CAGR >30%, cost to income 33-34%, credit cost <1%, ROA 2.5-2.7%, ROE 17-18%.

• IPO proceeds used to augment Tier-I capital for future growth and lending; all funds utilized as planned.

• Company continues to monitor regulatory changes, especially regarding new labour codes, and will adjust accounting as needed.

• Confident in sustaining strong performance in housing finance and maintaining stable margins despite competitive intensity.