CreditAccess Grameen reported a strong recovery quarter characterized by normalizing asset quality and robust margin expansion. Management successfully navigated the recent credit cycle, utilizing accelerated write-offs to clean the book while scaling the retail finance segment to over 14% of AUM. With PAR accretion levels reverting to historical norms, the company has issued confident guidance for FY27, targeting 20%+ growth and 4.0-4.5% ROA.
vs Q4 FY26
Notable Quotes from the Call
Most Confident Moment
Management's decision to provide specific FY27 guidance for ROA, NIM, and Credit Cost despite just coming out of a difficult credit cycle.
Least Confident Moment
Hedging on the exact timing of when credit costs in non-core states like UP and Bihar will fully revert to pre-crisis levels.
| Metric | Value | YoY |
|---|---|---|
| Net Interest Income | ₹977 Cr | +13.4% YoY |
| NIM | 13.9% | — |
| GNPA | 4.04% | — |
| Net Profit (PAT) | ₹252 Cr | — |
| AUM | ₹27K Cr | — |
| ROA | 3.5% | — |
Segment Breakdown
| Metric | Latest | Trend |
|---|---|---|
| AUM(crores) | 26566 | |
| PAT(crores) | 340 | |
| NIM | 14.2% | |
| GNPA | 4.04% | |
| Cost-to-Income Ratio | 30.7% | |
| Capital Adequacy Ratio | 25.9% |
| Category | Target | Priority |
|---|---|---|
| Profitability | Credit Cost→4% to 4.5% | High |
| Profitability | ROA→4.0% to 4.5% | High |
| Volume | AUM Growth→20% to 21% | Medium |
| Margin | NIM→14% to 14.5% | Medium |
| Severity | Risk |
|---|---|
medium | MFIN Guardrail Implementation Approval rates for new borrowers have dropped from 65% to 55-60%, impacting acquisition momentum. Both |
low | Credit Cost Stickiness in Non-Core States UP, Bihar, and MP still show credit costs 15-20 bps higher than pre-crisis levels, though trending down. Analyst |
low | Bank Borrowing Availability Industry-wide reports of banks pulling back from NBFC-MFIs; CREDITACC claims <60% dependency and continued access. Analyst |
Areas of Evasion(1)
The quarter was marked by a significant improvement in asset quality, with X bucket collection efficiency reaching 99.71% in December 2025. Monthly PAR 15+ accretion saw a sharp decline from 47 bps in September to just 18 bps in December, signaling a return to historical stability. Management noted that Karnataka, a core market, has shown a notable recovery with asset quality reverting to historical levels, supported by tighter credit oversight.
Retail finance now accounts for 14.1% of the total AUM, up from 11.1% in Q2 FY26. The portfolio reached ₹3,780 crore, driven by the graduation of high-quality vintage customers from group lending to individual business loans. While the average ticket size in some retail segments like 'Vishesh' loans has moderated to ₹80,000 to ensure better risk underwriting, the segment remains a key growth engine for FY27.
NIM increased by 60 bps QoQ to 13.9%, aided by a 30 bps improvement in yields and a 26 bps reduction in the average cost of borrowings (9.4%). The company raised ₹3,917 crore during the quarter at a marginal cost of 8.9%. Management expects NIMs to remain in the 14.0-14.5% range for FY27, though they may moderate pricing for customers if credit costs continue to decline.
Management has set a confident growth target of 20-21% for FY27, with microfinance expected to grow in the early teens and retail finance providing the additional momentum. The company is targeting an annualized ROA of 4.0-4.5% and an ROE of 16-17%. Credit cost guidance for the next fiscal is pegged at 4.0-4.5%, assuming a monthly PAR 15+ accretion rate of 30-35 bps.
The cost-to-income ratio stood at 34.1%, or 32.3% when adjusted for a one-time📎 ₹18 crore impact from new labour codes. Digital adoption is accelerating via the 'Grameen Mahi' platform, which has nearly 1 million downloads and helped achieve 20% digital collections by December 2025. Employee attrition also improved significantly, dropping to 30.2% from 35.2% a year ago.