IREDA Q2 FY27: PAT flat YoY at ₹552 Cr as Gensol-driven provisioning compresses margins

IREDA's consolidated total income rose 14.0% YoY to ₹2,346.88 Cr (standalone ₹2,344.75 Cr, basis differs <0.4%), but consolidated PAT of ₹552.14 Cr was essentially flat YoY (+0.5% vs ₹549.33 Cr) — a sharp deceleration from the 14% revenue growth. The QoQ jump (+63.1% from Q1 FY27's ₹338.53 Cr) looks dramatic but is mean-reversion off a weak prior quarter rather than a trend acceleration; EPS at ₹1.97 is unchanged from a year ago on a flat equity base (₹2,809.23 Cr paid-up capital), confirming profit growth, not just share-count dilution, stalled.

The story is margin compression on the lending book, not the topline. Net profit margin fell to 23.53% from 26.69% a year ago, and operating margin (total income less non-finance operating costs, our methodology) eased to roughly 88.7% from 93.29% YoY — though it did recover from Q1 FY27's 78.41%. Finance cost grew roughly in line with revenue (+13.6% YoY to ₹1,377.27 Cr), but impairment on financial instruments more than doubled to ₹187.70 Cr from ₹69.92 Cr YoY, the primary drag on profit growth. That impairment build coincides with the Stage-III provisioning coverage ratio rising sharply to 70.44% from 51.48% YoY, even as the net NPA ratio actually improved to 1.08% from 1.97% — a deliberately conservative provisioning stance rather than a deterioration in underlying asset quality.

The stock went into the print at ₹106.54, down 2.2% over the past month of trading.

For context: this is the second-highest quarterly PAT of the last 6 quarters; revenue is at a 6-quarter high.

Standalone PAT ₹554.26 Cr is within 0.4% of consolidated ₹552.14 Cr — no material divergence between the two bases

The provisioning build ties directly to this quarter's governance developments: at its 39th AGM on September 29, 2026 (within this reporting period per the event record), IREDA's board actions around the Gensol Engineering exposure (₹672.74 Cr, alongside a smaller Arjuna Biofuels case) drove the fraud reporting to RBI noted in both standalone and consolidated statements, with 100% ECL already provided. Management gives no formal quarterly guidance on record, and no press release commentary was available to cross-check against the print, so neither can be graded here. No Q2 FY27-specific consensus PAT estimate turned up in search; ICICI Direct's FY27E consolidated PAT estimate of ₹2,192 Cr (set ahead of Q1 FY27) implies H1 FY27's actual ₹890.67 Cr covers ~40.6% of the full-year number, meaning H2 needs to carry a larger share than usual — directionally consistent with a quarter that undershot normal profit cadence rather than beat it.