IIFL Finance Q1: consolidated PAT up 160% YoY to ₹713 Cr, margins double off low base

IIFL Finance reported a strong Q1 FY27 (quarter ended June 30, 2026) on a consolidated basis: net profit of ₹713.1 Cr, up ~160% year-on-year from ₹274.2 Cr and ~14% sequentially from ₹623.3 Cr, on revenue from operations of ₹3,919.2 Cr (+32.7% YoY, +6.1% QoQ). Net profit margin doubled to 18.18% from 9.26% a year ago. The standalone parent grew even harder — PAT ₹467.1 Cr versus ₹132.8 Cr a year ago (+252%) — with the ~92 basis-point wider standalone-vs-consolidated growth gap reflecting a softer quarter at IIFL Home Finance (subsidiary net profit fell ~7% YoY per exchange filings); readers seeing either number should note both tell the same growth story.

The optics are amplified by a weak comparison base. Q1 FY26 was a trough quarter, weighed down by impairment on financial instruments of ₹512.5 Cr; this quarter impairment normalised to ₹294.2 Cr even as the book grew, so the earnings jump is a combination of genuine topline expansion (+33%) and a base effect rather than a one-off write-back — there are no exceptional items on either side of the comparison. Finance costs rose to ₹1,719.5 Cr (from ₹1,288.8 Cr) in line with a larger balance sheet, while a ₹92.7 Cr consolidated deferred-tax credit held the effective tax rate at ~23%. Asset quality stayed firm — consolidated GNPA 1.55%/NNPA 0.82%, standalone GNPA 1.27% — with standalone CRAR at 17.07% and liquidity coverage a comfortable 220%.

The stock went into the print at ₹569, up 5.8% over the past month of trading.

For context: this is the highest quarterly PAT in the last 6 quarters on our records; PAT has now risen for 5 consecutive quarters; revenue is at a 6-quarter high.

Consolidated EPS ₹15.87 (₹5.49 YoY) — standalone EPS ₹10.98

Management offers no formal guidance, and no brokerage consensus for the quarter had surfaced by print, so the result can be judged only against the base (met/beat is unknown on both counts). The quarter's corporate actions point to a funding-led growth posture: the company raised USD 500M via 7.60% senior secured notes due 2029 (June 10), and the board approved a ₹10,000 Cr fundraise while upsizing the GMTN programme to USD 2 bn — capital being lined up ahead of loan growth, with the co-lending book already at ₹11,531 Cr (gold/retail). The main overhang is the ₹475.56 Cr income-tax demand from the January-2025 search assessment, which the company is contesting and has not provided for; a separate management change (Business Head–Unsecured Lending stepping down in an internal move) is not financially material.