01 — At a Glance
The Investment Bank That Built a Lending Disaster (And Is Now Pretending It Didn’t Happen)
- 52-Week High / Low₹200 / ₹78
- 9M FY26 Revenue₹4,146 Cr
- 9M FY26 PAT₹1,037 Cr
- Q3 EPS (₹)3.27
- Annualised EPS (Q3×4)₹13.08
- Book Value₹108
- Price to Book1.14x
- Dividend Yield2.22%
- Debt / Equity1.10x
- 1-Yr Stock Return+38.5%
A Quick Note on What Just Happened: JM Financial reported Q3 FY26 PAT of ₹313 crore (+50% YoY), making it look like a miracle recovery. Strip out one-time tax refund wins (₹113 crore) and statutory labour code impacts (₹21 crore), and the operating PAT is ₹244 crore (+17% YoY). Still solid. But here’s the thing: this company blew up its lending book spectacularly in FY24. Now it’s pivoting to investment banking and wealth management like nothing happened. The stock is up 38.5% in a year. So either the market has forgiven them, or nobody read the fine print.
02 — Introduction
A Financial Services Hedgehog: Nobody Knows What It Is. Even JM Financial.
Let me paint you a picture. JM Financial is supposedly an investment banking powerhouse. It ranked #1 in IPO and QIP market share in FY24. It manages capital markets, advises on M&A, runs private equity funds, runs wealth management, distributes financial products, and oh yes — also lends money.
The “lends money” part is where things went sideways.
Between FY22 and FY24, JM Financial built a wholesale lending empire. Real estate lending. Bespoke lending to corporates. Lending to other financial institutions. Asset reconstruction (buying distressed loans and trying to recover them). All of this. They hit distressed credit AUM of ₹10,940 crore in FY22 and thought they were geniuses. Then the assets went bad. Really bad. The Gross NPA ratio jumped to 8.7% by Q2 FY25. The company reported massive impairments. The RBI slapped restrictions on their lending in May 2024 (lifted in October 2024, but the damage was done). And suddenly, in May 2024, management announced: “We’re pivoting to asset-light.”
Translation: “We screwed up. We’re getting out of lending.”
Now Q3 FY26 shows this transition working. Loan book down 57% YoY to ₹4,616 crore. Borrowings down from ₹16,145 crore to ₹11,360 crore. The distressed credit AUM is being methodically unwound. And investment banking — the original competency — is roaring. Fees & commission income up 32% YoY. Capital market transactions pipeline at record levels.
But here’s the kicker: they’re not out of the woods yet. The company still carries ₹11,360 crore in debt. ROE is 9%. ROCE is 9%. These are not numbers that set venture capitalists on fire. They’re the numbers of a company still sorting its mess. The narrative is “we’re pivoting.” The reality is “we’re in transition, and until we deleverage, nobody knows what the final numbers will look like.”
Feb 2026 Concall Gold: Management said they’ve “never seen” the breadth and momentum in the corporate advisory business in their 30-year history. Peak optimism, peak cycle. Or genuine inflection point? We’re about to find out.
03 — Business Model: Six Businesses In Search of a Strategy
Investment Banking. Lending. Wealth. Asset Management. Oh, And Also Distressed Assets. Take Your Pick.
JM Financial is not a company. It’s a financial services laboratory experiment that somehow went public.
Segment 1: Corporate Advisory & Capital Markets (39% of revenue in H1 FY25). This is where they were born. They rank #1 in IPO and QIP syndication. They advise on M&A. They manage private equity funds. In Q3 FY25, 12 capital market transactions closed aggregating ₹36,000 crore. They have 54 IPOs filed with aggregate issue size of ₹121,000 crore. Of these, ~30+ are SEBI-approved. This is their crown jewel. And it’s printing money — but money is lumpy, not predictable.
Segment 2: Wealth & Asset Management (33% of revenue in H1 FY25). They’re expanding aggressively. Sales employees: 1,057 (up 41% YoY). Branches: 73. Franchisees: 922. Recurring AUM: ₹33,100 crore (+33% YoY). But here’s the pain: they’re investing massively in talent and infrastructure right now. Q3 operating profit in wealth dropped from ₹30 crore to ₹19 crore YoY because of recruitment and infrastructure costs. Management says hiring completes by June-July 2026, then they’ll focus on productivity. Translation: “We’re not profitable yet in this segment.”
Segment 3: Private Markets (31% of revenue in H1 FY25). Private credit (corporate, real estate, distressed), and private investments. The real estate wholesale book has been intentionally shrunk from ₹10,000 crore to ₹1,000 crore. They’re shifting to syndication (earn fee, don’t hold risk) instead of balance-sheet lending. In Q3, a ₹3,300 crore syndication deal went through. Management is confident recoveries will accelerate — they’ve guided for ₹900-1,000 crore in total recoveries, with ₹250-260 crore already done in 9 months. The remaining ₹700-750 crore should hit over the next 5 quarters.
Segment 4: Affordable Housing Finance (10% of revenue). 135 branches, 30,000+ customers, ₹3,200 crore AUM (+23% YoY). This is the boring, predictable, profitable segment they wish they focused on from day one. Q3 revenue ₹118 crore (+27% YoY), profit ₹22 crore (+53%). Clean credit. No drama.
Segments 5 & 6: Asset Management & Other. Asset management is still in investment mode (loss INR 9 crore in Q3). Other includes treasury, rental income, etc.
If you’re confused about what JM Financial actually does, congratulations — you understand the company better than most sell-side analysts.
💬 Which segment excites you most — the investment banking breadth, the wealth expansion, or the boring-but-profitable housing loans? Drop your take!
04 — Financials Overview
Q3 FY26: The Numbers (With Footnotes the Size of Small Books)
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