Paisalo Digital (PAISALO) Q2 FY27 Profit Rises 27% as Growth Meets Guidance
The NBFC's 27% profit growth hit its three-year target, but a sequential slowdown and margin pressure signal a maturing growth phase.
Paisalo Digital reported a 27% yearly profit rise to ₹65.6 crore, in line with its long-term guidance. While asset growth remains strong, the pace has cooled from Q1 and net interest margin slipped, highlighting a sector-wide funding cost challenge.
For Paisalo Digital, the September quarter was about delivering on a promise. The lender, focused on India's underserved borrowers, entered the period with a clear three-year target to roughly double its scale. Its Q2 results show it is on track, but the path is getting steeper. Profit grew 27% year-on-year to ₹65.6 crore, a solid beat against its own guidance but a step down from the blistering pace of the prior quarter.
The numbers tell a story of disciplined growth. Revenue rose 24% to ₹277.3 crore, while profit expanded slightly faster, lifting the net profit margin by 70 basis points to 23.7%. The quarter-on-quarter moves were more modest, with revenue up 6.5% and profit up 7.1%.
Revenue (₹ Cr)
Profit (₹ Cr)
Net Profit Margin (%)
| Metric | CurrentQ2 FY27 | PreviousQ1 FY27 | Same quarter LYQ2 FY26 |
|---|---|---|---|
| Revenue (₹ Cr) | 277.31YoY +24% | 260.29 | 224.01 |
| Profit (₹ Cr) | 65.64YoY +27% | 61.31 | 51.54 |
| Net Profit Margin (%) | 23.7YoY +3% | 23.6 | 23.0 |
The engine behind the growth
The top-line push came from relentless loan book expansion. According to reports from Stockwatch.live and Tradealone.com, Assets Under Management surged 33% year-on-year to over ₹7,265 crore, while quarterly disbursements jumped 42%. This was fueled by a vast network of over 6,400 touchpoints. Crucially, this growth came with cleaner books; consolidated gross NPAs improved to 0.65%, reports Stockwatch.live.
Profit grew faster than revenue because of this pristine asset quality. Lower credit costs helped offset a significant headwind: the cost of money. Finance costs soared 34% year-on-year, according to Tradebrains.in, outpacing revenue growth and squeezing the key net interest margin.
The margin squeeze that won't ease soon
Here lies the quarter's tension. While the bottom-line margin expanded, the core lending spread faced pressure. Management had guided for a Net Interest Margin of 6.6%, but the H1 FY27 consolidated NIM came in at 6.46%, as noted by Stockwatch.live. This modest compression points to a sector-wide reality: rising funding costs as bond yields stay elevated.
Live Chart
· PAISALO
(BSE)
ISIN: INE420C01059
Paisalo is fighting this with aggressive liability management. During the first half, it raised nearly ₹295 crore through public NCDs and over ₹177 crore via commercial papers, as reported by Scanx.trade. This diversified funding supports growth but at a higher cost, making sustained NIM a key watchpoint.
Key Points
- Consolidated profit grew 27.4% year-on-year to ₹65.64 crore, keeping the company on its guided three-year doubling trajectory.
- Strong loan growth drove performance, with AUM up 33% and disbursements up 42% year-on-year, supported by improving asset quality.
- Net interest margin saw modest compression against guidance, highlighting pressure from rising funding costs in the broader NBFC sector.
- The company actively managed its balance sheet, raising significant funds via NCDs and commercial papers to fuel continued expansion.
Hexa Perspective
Paisalo's quarter confirms it can grow at the 26% CAGR it promised, a notable feat in a competitive landscape. However, the sequential cooling from Q1 and the margin miss suggest the low-hanging fruit has been picked. The next phase depends on execution: leveraging technology and co-lending partnerships to keep customer acquisition costs in check while navigating a stubbornly high cost-of-funds environment. The valuation, at a 24% discount to the industry PE, reflects this balance between visible growth and emerging margin pressures. Investors are essentially betting that the company's niche focus and operational discipline can outlast the sector's cyclical squeeze.
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