Poonawalla Fincorp shares jump 6% intraday; JM Fin upgrades stock after Q3

Shares of Poonawalla Fincorp Ltd. pared gains after rising over 6 per cent as analysts remained positive after it reported its third-quarter earnings for the current financial year (Q3-FY26). 

 

The NBFC's stock rose as much as 6.2 per cent during the day to ₹492.6 per share, the biggest intraday gain since January 29, 2025. The stock pared gains to trade 1 per cent higher at ₹468 apiece, compared to a 0.63 per cent decline in Nifty 50 as of 11:13 AM. 

 

Shares of the company rose to the highest level since January 5 this year and currently trade at 12 times the average 30-day trading volume, according to Bloomberg. The counter has fallen 3 per cent this year, compared to a 2.2 per cent decline in the benchmark Nifty 50. Poonawalla Fincorp has a total market capitalisation of ₹38,006.66 crore.  CATCH STOCK MARKET UPDATES TODAY LIVE

Poonawalla Fincorp Q3 earnings

Poonawalla Fincorp reported a return on assets of about 1.2 per cent after five quarters, supported by a 702 per cent quarter-on-quarter (Q-o-Q) jump in profit after tax, JM Financial said.

 

Net interest income grew 50 per cent year-on-year (Y-o-Y) and 20 per cent Q-o-Q, driven by a 30 basis point sequential expansion in net interest margin and 78 per cent Y-o-Y and 15 per cent Q-o-Q growth in assets under management.

 

Asset quality improved with a decline in Stage 2 and Stage 3 assets and steady credit costs of 2.3 per cent. However, expected credit loss coverage moderated to around 1.6 per cent, particularly given the 46 per cent unsecured loan mix and the relatively unseasoned book, JM Financial noted.

Analysts on Poonawalla Fincorp Q3 results

Motilal Oswal said Poonawalla Fincorp’s Q3FY26 performance reflects improving business momentum, despite a near-term drag from higher provisions. Strong net interest income growth, margin expansion and sequential improvement in asset quality support earnings visibility.

 

The brokerage noted that management’s confidence in a gradual moderation in credit costs and improving operating leverage should aid a steady improvement in profitability and return on assets. 

 

With major investments in digital capabilities and distribution largely completed, and capital flexibility set to improve through the proposed qualified institutional placement, Poonawalla Fincorp is at an inflexion point for faster balance sheet growth and a sharp improvement in profitability, it added. Motilal Oswal reiterated a 'buy' rating on the stock with a target price of ₹610.  ALSO READ | How to trade ICICI Bank, HDFC Bank post Q3 results? Here's a trading guide 

JM Financial expects assets under management and pre-provision operating profit to grow at a compound annual growth rate (CAGR) of 46 per cent and 71 per cent, respectively, over FY26-28, with average return on assets and return on equity of 1.9 per cent and 11.4 per cent. 

 

The brokerage raised its FY27 and FY28 earnings per share (EPS) estimates by about 22 per cent and 13 per cent, upgraded the stock to 'Reduce' from 'Sell', and revised the target price to ₹430 from ₹425.  ==========

 

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