Cholamandalam Investment Q2 net profit rises 41% on strong income growth, plans Rs 5000 crore capital rais

Murugappa Group-backed Cholamandalam Investment and Finance posted a 41% rise in net profit to Rs 1,630 crore for the quarter ended September 2026, supported by higher net income, strong loan disbursements and lower loan losses.The board on Wednesday approved a proposal to raise up to Rs 5,000 crore through a qualified institutional placement. The capital would be raised over the next six to nine months, the management said on an analyst call.Assets under management rose 25% year on year to Rs 2.68 lakh crore, while aggregate disbursements increased 47% to Rs 35,872 crore during the quarter.Net income increased 24% to Rs 5,037 crore from Rs 4,075 crore a year earlier.

Loan losses declined 3% to Rs 874 crore, supporting profitability even as total expenses rose 22% to Rs 1,975 crore. Profit before tax increased 40% to Rs 2,188 crore. Total income rose 23% to Rs 9,367 crore, while finance costs increased at the same pace to Rs 4,329 crore.Net interest margin remained flat at 7.9% in the second quarter. Speaking to analysts after the results, the management said it expects the cost of funds to rise by 10-15 basis points year on year in the coming quarter.

Nearly half of Cholamandalam’s borrowings are at floating rates, while the remainder is linked to banks’ marginal cost of funds-based lending rates. Total borrowings stood at Rs 2.31 lakh crore at the end of September 2026.Live EventsThe vehicle-finance book grew 21% to Rs 1.30 lakh crore, while disbursements stood at Rs 17,801 crore. The loan-against-property portfolio grew 24% to Rs 57,447 crore, while disbursements stood at Rs 6,438 crore.The SME-loan book grew 45% to Rs 10,943 crore, while disbursements stood at Rs 2,453 crore.

The gold-loan business, launched in 2026, accounted for 5% of total disbursements. Its assets under management stood at Rs 3,446 crore, while disbursements were Rs 1,960 crore. The company operated the business through 308 branches.(You can now subscribe to our ETMarkets WhatsApp channel)