IndoStar Capital Finance Q2FY26 Concall Decoded: The NBFC That’s Finally Finding Its ‘Star’ Moment
Remember when IndoStar was a corporate lender trying to out-banker the banks? Now it’s a lean, retail-hungry NBFC with a new haircut and humbler ambitions. The sale of Niwas Housing was the final cleanse—because who needs baggage when you’ve got Micro LAP dreams and repo rates dropping faster than Sensex tweets? The Gita says, “Change is the law of the universe,” and IndoStar seems to have finally read that line.
Keep reading—because the story of a turnaround in slow motion just got interesting.
At a Glance
Revenue up 15.7% YoY – CFO swears it’s not Excel magic, just actual lending.
Disbursements ₹927 cr – Up 8% QoQ; vehicle loans are still the bread and butter.
AUM ₹7,564 cr – Down slightly, thanks to an ARC haircut no one wanted to mention.
NII ₹190 cr – Margins up to 7.6%, proving spreads can heal wounds.
Net Profit ₹10.4 cr – Profit yoga: lower but steady breathing.
GNPA 3.04%, NNPA 1.13% – The balance between risk and redemption.
Capital Adequacy 37.3% – The CFO’s favorite bedtime story.
Management’s Key Commentary
“We’ve transformed from corporate to retail NBFC.” (Translation: We’ve learned that lending to truck drivers beats lending to tycoons.)
“Micro LAP is our next growth engine.” (The new toy. It’s small, cute, and we promise not to break it this time.)
“Cost of borrowing down from 10.8% to 10.2%.” (When even RBI cuts rates, you don’t need divine intervention.)
“Collection efficiency at 94%, up from 92% last year.” (Still not 97%, but hey, who’s counting in an NBFC?) 😏
“We’ve converted 48 micro branches to full-fledged ones.” (Because calling them ‘micro’ hurt our ego.)
“Our focus is sustainable, quality growth.” (Corporate code for ‘we’ve stopped chasing volume for Instagram likes.’)
“We’ll expand Micro LAP to Andhra and Telangana.” (Because Tamil Nadu alone can’t carry our dreams forever.)
Numbers Decoded
Metric
Q2FY26
Q1FY26
Q2FY25
Comment
AUM (₹ Cr)
7,564
7,783
7,912
Slight dip; ARC deal shaved it.
Disbursements (₹ Cr)
927
858
1,452
Vehicle finance dominates.
NII (₹ Cr)
190
184
164
Margins up to 7.6%.
Cost of Funds
10.2%
10.4%
10.8%
RBI rate cuts helping.
GNPA
3.04%
3.5%
4.7%
Downward trend; tightening works.
Net Profit (₹ Cr)
10.4
12.7
18.0
Impact of ARC sale.
The math says IndoStar’s pruning phase is paying off—asset quality up, growth steady, and profits just catching their breath.
Analyst Questions
Rhea (SDA Finance): Why is Micro LAP still only 3%? (Because Rome—and retail NBFCs—aren’t built in two quarters.)
Shubhranshu (Phillip Capital): Will GST cuts boost CV loans? (Yes, but only after truckers Google “GST rate cut meaning.”)
Sumit (MK Ventures): Why fewer branches and people? (Because merging two lazy branches beats running one half-empty.)
Faizaan (Singularity AMC): You guided 15% growth, got 8%. What changed? (We got cautious. Caution is the new aggression.)
Varun (Omkara Capital): Collection efficiency fell to 94%. Why? (Seasonal, sir. Even borrowers take festive breaks.)
