Aye Finance Q1 PAT more than doubles YoY to ₹74.5 Cr as credit costs, opex leverage improve

Aye Finance reported standalone Q1 FY27 (Jun-2026) net profit of ₹74.50 Cr, up ~144% from ₹30.59 Cr a year earlier, on revenue from operations of ₹477.37 Cr (+17.7% YoY). The step-change is a margin story, not a topline one: net profit margin widened to 15.22% from roughly 7.4% in the depressed year-ago quarter, as total expenses grew just ~5% (₹373.74→₹392.51 Cr) against ~18% income growth. Impairment on financial instruments actually eased to ₹81.41 Cr (Q1 FY26: ₹86.71 Cr) even as the loan book expanded, confirming the credit-cost normalisation management flagged on the Q4 call — the earlier print had been dragged by industry-wide MFI/micro-business stress. There are no exceptional items, so reported and underlying growth are the same.

Sequentially the quarter looks softer — revenue from operations fell 7.3% and PAT 13.3% versus Q4 FY26 (₹85.91 Cr) — but that comparison is distorted by Q4's ₹48.01 Cr net gain on fair-value changes (vs ₹5.14 Cr this quarter) and by higher employee costs (₹138.64 Cr, +22% YoY) as the franchise scaled; QoQ NPM slipped only marginally to 15.22% from ~16.2%. The YoY comparison is the cleaner read and it is strong. Operating metrics corroborate: AUM grew 28% YoY to ₹7,329 Cr (+4% QoQ), disbursements +22% to ₹1,219 Cr and new borrowers +38% to 44,736 — squarely inside the 25-30% FY27 AUM guidance given in April. Gross Stage III stood at 4.49%, Net NPA 1.67%, PCR 63.80%, with CRAR a heavily capitalised 42.38% and LCR 269.61%, reflecting the ₹672.24 Cr fresh IPO proceeds (Feb-2026 listing) now fully deployed into the capital base.

The stock went into the print at ₹184.91, up 10.4% over the past month of trading.

Street has no published Q1 PAT consensus for this recently-listed name; the available FY27 view pencils ~15-20% PAT growth (Univest, target ₹200 vs CMP ~₹166), which this print runs well ahead of — though partly a low-base effect. Against management's own April guidance the quarter is on-track: AUM growth within range, credit costs falling and annualised earnings implying ROA near the guided 4-4.5%. One caveat sits in the covenant annexure — a single NCD (INE501X07588) breached clause 10.3(a) on the PAR-90-plus-write-offs ratio owing to elevated write-offs from sector-wide micro-loan stress, for which a lender waiver was obtained; the concurrent board actions this week (₹200-4,000 Cr NCD issuance plans, ESOP grants) point to continued funding-led expansion.