Synopsis:
CreditAccess Grameen Ltd is in focus after announcing Q1FY26 results, with analysts maintaining a positive outlook despite a net profit dip.
A small-cap non-banking finance company is in focus today after announcing its financial results for Q1FY26. Check the article below to know about their performance and future target given by the analyst.
With a market capitalization of Rs. 21,829 crores, the shares of CreditAccess Grameen Ltd were trading at Rs. 1,367, up by 6.75 percent from its previous closing price of Rs. 1,279.90.
Q1FY26 Results
CreditAccess Grameen Ltd reported Rs. 1,463 crores in revenue for the first quarter of FY26, a slight 3.24 percent decrease over the Rs. 1,512 crores for the same period in FY25. However, from Rs. 1,407 crores in Q4 FY25, revenue increased by about 3.98 percent sequentially.
The consolidated net profit for the first quarter of FY26 was Rs. 60 crores, which was a marginal increase by 27.66 percent compared to Rs. 47 crores reported in the previous quarter but when compared to Rs. 398 crores in Q1FY25, it saw a sharp decline of 84.92 percent.
Profit decline was also reflected in earnings per share (EPS), which decreased to approximately Rs. 3.77 in Q1 FY26 from Rs.24.95 in Q4 FY25 and Rs. 2.96 in Q4 FY25.
CreditAccess Grameen reported a Net Interest Margin (NIM) of 12.8 percent, while its Gross Loan Portfolio (GLP) stood at Rs. 26,055 crore, showing a slight decline of 0.9 percent YoY. The cost-to-income ratio was 33.5 percent. Asset quality metrics included a Gross NPA (GNPA) of 4.70 percent and Net NPA (NNPA) of 1.78 percent. This resulted in a ROA of 0.9 percent and a ROE of 3.4 percent. The company maintains a healthy capital position with a CRAR of 25.5 percent.
CreditAccess Grameen reported solid business results for the first quarter of FY26. Disbursements increased by 21.9 percent annually to Rs. 5,458 crore, and 2.16 lakh new borrowers were added, 43 percent of whom had never been credited before. The number of employees rose to 21,333, and the branch network grew to 2,114. Asset quality increased as collection efficiency increased to 94.1 percent, and PAR 0+ decreased to 5.9 percent. AUM stayed steady at Rs. 26,055 crore, but the retail finance portfolio expanded dramatically by 134.1 percent YoY to Rs. 1,783.5 crore.
Management View
According to CreditAccess Grameen’s CEO and MD (Designate), Mr. Ganesh Narayanan, the company had a successful start to FY26 and was experiencing strong business momentum. Its highest-ever first-quarter disbursements of Rs. 5,458 crore were recorded in Q1FY26. In June 2025, the monthly new delinquency rate decreased from 1.34 percent in November 2024 to 0.46 percent, supported by stable staffing, improved customer service, and decreased customer leverage.
The company maintained a controlled annualized attrition rate of 27.1 percent while growing its workforce from 20,970 in March 2025 to 21,333 in June 2025, which enhanced asset quality and customer service. CreditAccess Grameen raised Rs. 2,570 crore for funding, which included a partial drawdown from a $100 million multi-currency syndicated social loan (USD and JPY) that was priced competitively with domestic borrowings.
Furthermore, a strategic focus area, the Retail Finance portfolio, grew from 2.9 percent to 6.8 percent of AUM annually. With a positive monsoon forecast and rising rural sentiment, the outlook for FY26 is still bright.
About the company
CreditAccess Grameen Limited is a leading microfinance company with its headquarters in Bengaluru, it mainly provides microloans to Indian rural women. The organization has 2,114 branches and operates in 433 districts throughout 16 states and 1 union territory. The company is supported by institutional investors and promoted by CreditAccess India B.V., a global company with more than ten years of microlending experience in India.
Analyst Outlook
JM Financial valued CreditAccess Grameen at 2.6x FY27 E/BVPS and upgraded it to ‘Buy’ with a revised target price of Rs. 1,475 (previously Rs. 1,135). During FY25–27, the firm expects 15 percent average RoE and 15 percent AUM CAGR. It expects that the company will recover faster than the other MFIs due to its early stress detection, quick write-offs, and its higher Expected Credit Loss (ECL) coverage.
MOFSL (Motilal Oswal) valued CREDAG at 2.1x FY27 P/BV and kept its ‘Buy’ rating with an unaltered target of Rs. 1,500. Although it anticipates higher credit costs in Q2FY26 as a result of Karnataka stress and MFIN regulations, it observes normalization of the sector by 2HFY26. MOFSL thinks that CREDAG’s solid fundamentals and quicker recovery than its peers justify its premium valuation.
Written by Akshay Sanghavi
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