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Sundaram Finance Ltd
NSE: SUNDARMFIN BSE: 590071 INE660A01013 Financial Services NBFC 🔎 Screen
NIFTY 500 Midcap 150
₹51,802 Cr
Market Cap
3.50
P/B
4.80%
NIM
15.0%
ROE
GNPA
31.0%
Fin. Margin
-16.1%
% from 52W High
61
α RS
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📈 Price History
Ratio Health
Excellent
Good
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By Category
Shareholding
About

Sundaram Finance is a registered deposit taking NBFC established in 1954. The Co. is engaged in retail finance across multiple domains like Vehicle finance, Home Finance, Mutual Funds, General insurance and Financial service distribution

✓ Strengths 1
  • Company has been maintaining a healthy dividend payout of 21.6%
! Concerns 2
  • Stock is trading at 3.51 times its book value
  • Company has low interest coverage ratio.
Key Ratios Snapshot
📊 Sector Averages
📈 Growth Pattern
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Bear / Base / Bull projections · DCF fair value · Reverse-DCF
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Strong quarter: PAT up 22% YoY, AUM up 17%, and asset quality improved to 1.71% gross stage 3. quarter Investor Presentation One-Pager? Jun 2026
Revenue
₹1,963 Cr
Revenue from operations +13.5% YoY; total revenue ₹2,054 Cr (+10.7% YoY)
PAT
₹522 Cr
+22% YoY; consolidated PAT ₹636 Cr, +34% YoY
Key Metric
AUM ₹62,275 Cr
+16.9% YoY; gross stage 3 1.71% vs 1.91%; ROA 3.06% vs 2.91%
What Went Right
  • AUM rose 16.9% YoY to ₹62,275 Cr; disbursements grew 22% to ₹8,947 Cr, helped by strong regional auto volumes (MHCV +16%, LSCV +23%, cars +26%).
  • PAT grew 22% YoY to ₹522 Cr; ROA improved to 3.06% from 2.91% and core ROE jumped to 18.2% from 15.3%.
  • Asset quality improved: gross stage 3 down to 1.71% from 1.91%, net stage 3 to 0.88% from 1.08%, and provision cover up to 49% from 44%.
  • NII grew 19% to ₹925 Cr, supported by AUM growth and disciplined borrowing costs.
  • Consolidated PAT rose 34% YoY to ₹636 Cr, led by Sundaram Home Finance PAT of ₹85 Cr (+36% YoY) and AMC PAT of ₹51 Cr (+13% YoY).
What to Watch
  • Cost-to-income worsened to 30.70% from 29.84% YoY; operating expenses grew ~20% to ₹294 Cr, far faster than total revenue growth of ~11%.
  • Total revenue growth (+10.7%) lagged AUM growth (+16.9%), with dividend income dropping to ₹81 Cr from ₹124 Cr YoY.
  • Capital adequacy fell to 18.5% from 20.0% at Jun-25 and 19.1% at Mar-26; leverage rose to 4.2x from 3.9x.
  • Royal Sundaram's combined ratio deteriorated to 116.3% from 110.2% YoY, pointing to continued underwriting losses at the insurance JV.
  • Current demand collections stood at 92% with no prior-year comparative disclosed, leaving limited stated cushion if the auto cycle slows.
Investor Lens
Q1FY27 is a strong beat for the core lending franchise: AUM +17%, disbursements +22%, PAT +22%, gross stage 3 at 1.71%, and core ROE at 18.2%. The thesis remains intact, but the quarter also shows early strain: operating expenses grew ~20% YoY, C/I rose 86bps to 30.70%, and CAR slipped to 18.5% from 20.0%. Dividend income fell ~35% YoY, so total revenue growth of ~11% trailed balance-sheet growth materially. Watch next for collection efficiency (92% current collections), Royal Sundaram's underwriting turnaround (COR 116.3%), capital actions, and whether 22% disbursement growth can hold as base effects fade. No explicit FY27 numeric guidance was provided.
From investor presentation · AI-generated analysis · Not investment advice
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📈 STRONG Strong quarter: PAT up 33.9% YoY to ₹636 Cr, financing margin expands to 31%
Revenue
Revenue grew 12.6% YoY to ₹2,644 Cr, with a sequential increase of 3.3% from Q4 FY26. This indicates steady business momentum despite a competitive financing environment.
Profitability
Net profit rose 33.9% YoY to ₹636 Cr, with EPS improving to ₹57.26 from ₹42.77 a year ago. Sequentially, PAT grew 14.8% while PBT stood at ₹767 Cr, reflecting healthy operating leverage.
Margins
Financing margin improved to 31% from 27% YoY, though it moderated slightly from 32% in the preceding quarter. The YoY expansion signals better spreads, but the small QoQ dip warrants monitoring for NIM pressure.
Cash Flow
Skip — not applicable for banking/financial companies.
Balance Sheet
Specific balance sheet details such as deposits, advances, and capital adequacy were not disclosed in this summary. Given the healthy revenue growth and ROE of 15%, the company appears to be deploying capital efficiently.
Key Risks
Key risks include potential financing margin compression if funding costs rise, asset quality deterioration in a slowing economy, and regulatory changes affecting NBFC lending norms. Credit costs remain a variable to track closely.
Outlook
With strong PAT growth and margin expansion, the company is on a steady path. Continued focus on asset quality and loan growth will be crucial to sustain momentum amid competitive pressures.
Generated by AI · Jun 2026 results · Not investment advice
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Revenue by Segment

Segment Q2FY26 Q3FY26 Trend
Asset Financing
2,200
EBIT 583
2,337
EBIT 678
Others
178
EBIT 71
b) Others
186
EBIT 73
Total 2,386 2,515

Source: NSE Integrated Filing XBRL (Reg. 33 Ind AS). Values in ₹ Crore.

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NIM, GNPA, CASA, CAR, ROA, ROE and more — extracted from investor presentations
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Investment Risk:
Investing in securities, including equities and mutual funds, involves inherent risks, including the potential loss of principal. All investments are subject to market fluctuations, regulatory changes, and other risks that may affect their value. Past performance is not indicative of future results. This report is provided for informational and educational purposes only and should not be construed as investment advice under any circumstances.

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The author and/or analyst may currently hold or have previously held positions in the securities or financial instruments discussed in this report. Any such positions, if material, are disclosed to the best of the author's knowledge and are not intended to influence the objectivity or independence of the analysis. This research is produced independently and is not sponsored, endorsed, or commissioned by any company, institution, or third party.

Information Sources:
The analysis and opinions expressed herein are based on publicly available information, including but not limited to company filings with the BSE/NSE, annual reports, management commentary, investor presentations, data from the Reserve Bank of India (RBI), SEBI, industry publications, and other reliable financial data sources. Information is believed to be accurate as of the date of publication but may be subject to change without notice. Readers are encouraged to independently verify all information before acting upon it.

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