Synopsis: A leading credit rating stock advanced over 8 percent in Thursday’s session after reporting a sharp 119 percent sequential rise in net profit for Q2FY26. Investor sentiment also improved after the company announced plans to sell a 9.9 percent stake each in its key subsidiary to SBI and NSE IFSC.
A leading credit rating stock surged over 8 percent on Thursday after posting a strong Q2FY26 performance, marked by a 119 percent sequential rise in net profit. The rally also followed the company’s announcement to sell a 9.9 percent stake each in its key subsidiary to SBI and NSE IFSC.
CARE Ratings Ltd, with a market capitalization of around Rs. 4,864.60 crore, opened at Rs. 1,600.30 on the BSE against a previous close of Rs. 1,520.60. The stock hit an intraday high of Rs. 1,651.05, marking a gain of 8.58 percent.
Financial Snapshot – Q2FY26
Quarter-on-Quarter (QoQ): Revenue from operations increased from Rs. 94 crore in Q1FY26 to Rs. 136 crore in Q2FY26, up 44.7 percent. Operating profit rose sharply from Rs. 28 crore to Rs. 68 crore, a jump of 142.9 percent, with operating profit margin expanding from 30 percent to 50 percent.
Profit before tax grew from Rs. 37 crore to Rs. 77 crore, up 108.1 percent, while net profit surged from Rs. 26 crore to Rs. 57 crore, a rise of 119.2 percent sequentially. Earnings per share increased from Rs. 8.61 to Rs. 18.89.
Year-on-Year (YoY): Compared to the same quarter last year, revenue increased from Rs. 117 crore to Rs. 136 crore, a growth of 16.2 percent. Operating profit improved from Rs. 56 crore to Rs. 68 crore, up 21.4 percent, with operating margin rising from 47 percent to 50 percent.
Profit before tax grew 20.3 percent to Rs. 77 crore from Rs. 64 crore, while net profit rose 21.3 percent to Rs. 57 crore from Rs. 47 crore. Earnings per share increased to Rs. 18.89 from Rs. 15.41. The company reported an EBITDA margin of 50 percent and PAT margin of 38 percent during the quarter.
Management Commentary
Commenting on the results for Q2 and H1FY26, Mehul Pandya, Managing Director & Group CEO of CareEdge, said:
“Even as we navigate through multiple global headwinds, we are pleased to report a healthy 13% year-on-year growth in standalone revenue from operations during Q2 FY26, driven by our strong and diversified client base. On a consolidated basis, revenue grew by 16%, supported by improved performance across subsidiaries and further strengthened by our non-ratings businesses. Profitability at both standalone and consolidated levels remains robust, reflecting disciplined execution and operational efficiency.
For H1 FY26, standalone revenue grew by 14%, while consolidated revenue recorded a strong 17% growth, accompanied by steady margins and profitability. We continue to emphasise that our financial performance is best viewed through an annual lens, as our focus remains on building sustainable, long-term growth. The progress across our core and emerging businesses reinforces our confidence in the strategic direction we have set for the Group.”
Dividend
The Board of Directors declared an interim dividend of Rs. 8 per equity share of face value Rs. 10 each for FY2025-26. The record date for determining shareholder eligibility is set as Wednesday, November 19, 2025.
Sale of Stake to SBI and NSE IFSC
The company approved the sale of a partial stake in its wholly owned subsidiary, CareEdge Global IFSC Limited (CGIL), to State Bank of India and NSE IFSC Limited. It will sell up to 9.9 percent stake each to both buyers, post which the company will continue to hold 80.2 percent in CGIL. Consequently, CGIL will cease to be a wholly owned subsidiary of CARE Ratings.
About the Company
CARE Ratings Ltd, incorporated in April 1993, is among India’s leading credit rating agencies. The company provides a range of rating services that help corporates raise capital and enable investors to make informed investment decisions based on credit risk assessment and expected returns.
-Manan Gangwar
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