10 hours ago
Hero FinCorp reported a weak set of numbers for Q3FY26, with losses increasing compared to the same quarter last year. The pressure came mainly from higher credit costs and rising finance expenses, which continued to weigh on overall performance.
During the quarter, total income declined on a year-on-year basis. Lower interest income reflects pressure on lending yields and a cautious lending environment. At the same time, borrowing costs remained high, which affected margins.
The biggest impact came from impairment on financial instruments. Provisions increased sharply, showing that the company has set aside a larger buffer against potential loan defaults. As a result, Profit Before Tax slipped further into loss. Net loss also widened compared to Q3FY25, and earnings per share moved deeper into negative territory.
Looking at the nine-month performance (9MFY26), the trend remains under stress. While income remained relatively stable, profitability weakened significantly. The company moved from profit in the previous year to a net loss this year, indicating continued pressure across quarters.
On the operational side, asset quality showed some deterioration. Gross NPA and Net NPA ratios increased year-on-year, mainly due to stress in MSME and unsecured loan segments. However, the Provision Coverage Ratio improved, which provides some comfort from a risk management point of view.
Capital and liquidity levels remain stable. The capital adequacy ratio stayed above regulatory requirements, and liquidity coverage improved strongly. This suggests that while earnings are under strain, the balance sheet has enough cushion to manage near-term volatility.
During the quarter, the company also raised funds through non-convertible debentures to strengthen liquidity and manage refinancing needs. There has been ongoing effort to clean up the loan book by transferring stressed assets and selectively acquiring better-quality portfolios.
In the unlisted market, the Hero Fincorp Share Price may reflect these quarterly developments, as investors assess both short-term losses and long-term balance sheet strength.
Overall, Q3FY26 highlights continued stress driven by high credit costs and funding expenses. The coming quarters will be important to see whether asset quality stabilises and whether provisioning levels start to normalise.
During the quarter, total income declined on a year-on-year basis. Lower interest income reflects pressure on lending yields and a cautious lending environment. At the same time, borrowing costs remained high, which affected margins.
The biggest impact came from impairment on financial instruments. Provisions increased sharply, showing that the company has set aside a larger buffer against potential loan defaults. As a result, Profit Before Tax slipped further into loss. Net loss also widened compared to Q3FY25, and earnings per share moved deeper into negative territory.
Looking at the nine-month performance (9MFY26), the trend remains under stress. While income remained relatively stable, profitability weakened significantly. The company moved from profit in the previous year to a net loss this year, indicating continued pressure across quarters.
On the operational side, asset quality showed some deterioration. Gross NPA and Net NPA ratios increased year-on-year, mainly due to stress in MSME and unsecured loan segments. However, the Provision Coverage Ratio improved, which provides some comfort from a risk management point of view.
Capital and liquidity levels remain stable. The capital adequacy ratio stayed above regulatory requirements, and liquidity coverage improved strongly. This suggests that while earnings are under strain, the balance sheet has enough cushion to manage near-term volatility.
During the quarter, the company also raised funds through non-convertible debentures to strengthen liquidity and manage refinancing needs. There has been ongoing effort to clean up the loan book by transferring stressed assets and selectively acquiring better-quality portfolios.
In the unlisted market, the Hero Fincorp Share Price may reflect these quarterly developments, as investors assess both short-term losses and long-term balance sheet strength.
Overall, Q3FY26 highlights continued stress driven by high credit costs and funding expenses. The coming quarters will be important to see whether asset quality stabilises and whether provisioning levels start to normalise.
