Religare Enterprises Limited — Q3 FY26 earnings call

Call held 16 Feb 2026

Management summary

Religare Enterprises delivered a mixed Q3 FY26, marked by strong operational performance in its insurance and broking segments, with consolidated total income rising 23.8% YoY. However, the group's 9M FY26 PBT remained negative due to one-time provisions and accounting impacts. A significant strategic demerger of the financial services business was announced, aiming to unlock shareholder value and create focused entities, with the process expected to take 15-18 months.

Highlights

  • Consolidated total income for Q3 FY26 was ₹2,067.9 crores, up 23.8% from ₹1,670.2 crores last year.

  • Care Health Insurance's retail business grew 41% YoY on a full premium basis, and AUM crossed the ₹10,000 crore milestone.

  • Religare Broking's revenue increased 11.6% YoY to ₹91 crores, and PBT grew 842% to ₹6.6 crores.

  • Religare Finvest reported a stable Net NPA of 1% and a strong CRAR of 228%, with collection efficiency at 99%.

  • The company announced a strategic demerger of its financial services business to create two focused and independent listed entities.

Concerns

  • Consolidated PBT for 9M FY26 was a negative ₹103.1 crores, compared to a negative ₹78.9 crores in the prior year.

  • Care Health Insurance incurred a one-time charge of ₹13.5 crores due to the new labor code.

  • Religare Finvest's Q3 FY26 profit after tax was reduced to ₹1.2 crores due to an impairment provision of ₹17.4 crores on subsidiary investment and new labor code provision.

  • Religare Housing Finance reported a loss of ₹5.93 crores in Q3 FY26, partly due to provisioning related to the new labor code.

Key financials

2 periods

Headline

  • Consolidated Total Income
    ₹2,067.9 Cr
    YoY +23.8%
  • Care Health Insurance AUM
    ₹10,000 Cr
  • Care Health Insurance Solvency
    1.7
  • Religare Broking Revenue
    ₹91 Cr
    YoY +11.6%
  • Religare Broking PBT
    ₹6.6 Cr
    YoY +842%

9M FY26

  • Consolidated PBT
    ₹-103.1 Cr

What they filed

Q1 FY27: revenue up 950.0%, net profit down 56.4% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue3 0 0 0 1 −74%1 +3325%2 +5633%3 +950%
EBITDA-17 -16 -8 -7 -8 +55%-12 +27%-13 −56%-11 −62%
Net profit9 -13 -18 -6 -4 −142%-11 +15%-12 +30%-10 −56%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Segment breakdown

  • Insurance Business (Care Health Insurance)
    ₹1,931.9 Cr Revenue (Q3 FY26)₹-111.2 Cr Profitability (Q3 FY26)41% Retail Growth (Full Premium Basis)₹265 Cr PBT (9M FY26, Full Premium Basis)1.1% Combined Ratio (YTD)9.9% Market Share (Private Players)97% Claims Settlement Ratio
  • Financial Services
    ₹143.1 Cr Revenue (Q3 FY26)₹8.5 Cr Profit (Q3 FY26)
  • Religare Broking
    ₹91 Cr Revenue (Q3 FY26)₹6.6 Cr PBT (Q3 FY26)93% Client Debit Book (YoY Growth)21% E-governance Business Growth (YoY)₹42,642 Cr Assets Under Custody
  • Religare Finvest Limited (RFL)
    ₹70 Cr Core Book (SME)₹480 Cr Cash Balance99% Collection Efficiency1% Net NPA228% CRAR₹800 Cr Net Worth₹49.9 Cr PBT (9M FY26)
  • Religare Housing Finance
    ₹241 Cr AUM97.4% Collection Efficiency132% CRAR₹184 Cr Capital Base3.5% NNPA

Capital allocation

high confidence
  • M&A Financial Services Business (from REL to RFL) Divestment · Announced

    To unlock shareholder value, create business clarity, and position resulting entities for sustained long-term growth.

    RFL will issue fully paid-up equity shares to REL shareholders in a 1:1 ratio. RFL will be listed on bourses.

    On 14th Feb 2026 this year, the Boards of Religare Enterprises Limited and Religare Finvest Limited have approved the demerger of financial services and insurance businesses of the group into two focused and independent listed entities.
  • Liquidity Cash ₹480 Cr Religare Finvest Limited (RFL) currently has a cash balance of ₹480 crores and a net worth in excess of ₹800 crores, making it well-capitalized to restart business.
    RFL currently has a core book of SME of INR70 crores which is left, along with a cash balance of INR480 crores. ... Our net worth is showing steady growth from INR350 crores to about INR366.6 crores. ... the cash is available, there is enough capital by way of net worth in excess of INR800 crores

Guidance & targets

Strategic

  • Demerger Process Completion Strategic · Q1 FY28 · High confidence 15-18 months
    The company expects the entire process to take 15 to 18 months starting from the current quarter and shall culminate in the first quarter of FY '28.

    — Pratul Gupta

  • RFL Listing Strategic · Q1 FY28 · High confidence Q1 FY28
    As mentioned earlier, we aim to list RFL in the first quarter of FY 2028 after the completion of the process.

    — Pratul Gupta

Capital Adequacy

  • Care Health Solvency Ratio Capital Adequacy · Ongoing · High confidence 1.7 or above
    So I think we will continue to we are comfortable at the range of 1.7. So we'll continue to maintain in the similar range of 1.7 or above 1.7.

    — Ambrish Jindal

Capital Allocation

  • Capital Infusion for Care Health Capital Allocation · As per original plans · High confidence ₹600 crores
    And as envisaged, CARE will get an investment of up to INR600 crores as per the original plans.

    — Pratul Gupta

  • Capital Infusion for Housing Finance Capital Allocation · Near-term · Medium confidence ₹250 crores
    In terms of housing, again, right now, we don't have any lending lines, and we have aimed to infuse a large sum up to INR250 crores in housing finance.

    — Pratul Gupta

What to watch in Q4 FY26

Care Health IFRS Numbers Disclosure

Next quarter or next to next quarter
Current In process of preparation
Target Published IFRS numbers

Why it matters

IFRS numbers are expected to be higher than reported, providing a clearer picture of insurance profitability and valuation.

So we're in the process of preparation of these IFRS numbers and maybe from next quarters or next to next quarter, we would be publishing those numbers.

Risks & concerns

  • LVB Fixed Deposits Recovery

    medium

    ₹750 crores fully provisioned in RFL, but the matter is subjudice in Delhi High Court, making recovery uncertain and potentially prolonged.

    Both acknowledged

  • Potential Equity Dilution for Demerged NBFC

    medium

    Analyst concern about large equity dilution at a low multiple for the demerged NBFC (RFL) if it does not achieve a right equity listed valuation, which management aims to mitigate through value accretion.

    Analyst acknowledged

  • New Labor Code Impact

    low

    One-time charge of ₹13.5 crores for Care Health Insurance and impact on profitability for RFL and Religare Housing Finance due to new labor code provisions.

    Management acknowledged

  • 1/n Accounting Impact on Insurance Reporting

    low

    The new 1/n accounting methodology defers premium and profit recognition, leading to lower reported top line and profitability for insurance, though it's a timing difference, not an economic loss.

    Management acknowledged

Q&A highlights

2 direct, 2 evasive
Demerger Rationale and Scope Partial
Well, I think this is as I mentioned, this is the first step in that direction. And as and when the conditions are conducive and there are certain other milestones which are achieved by these businesses, we could be evaluating such options in the future.

Analyst questioned why CARE was not included in the demerger for immediate value unlocking, and management indicated it's a phased approach dependent on future conditions.

Asked by Umang Shah

Future Reverse Merger of CARE Evasive
Well, as I mentioned, Adarsh, I mean, we will decide about future course of action as and when conditions and situations are conducive. There could be many possibilities.

Analyst probed if a reverse merger of CARE into the holding company was the eventual plan, but management remained non-committal, citing future conditions.

Asked by Adarsh

Utilization of Capital Raise Direct
So out of INR1,500 crores of warrants, which we raised, so far, as of the end of the quarter, we have received INR410 crores, which included INR375 crores of upfront premium and another INR35 crores of conversion of warrants. Out of this INR410 crores INR256 crores has already been infused in CARE by way of subscription of rights issue...

Analyst sought clarity on the deployment of the ₹1,500 crore capital raise, and management provided a detailed breakdown of funds received and allocated to date.

Asked by Adarsh

IRDAI Promoter Shareholding for CARE Partial
Well, without specifically commenting on a particular stakeholder or participant, what I would like to say Hitaindra is that there are certain conversations, certain situations which need to be sort of achieved before we take that step.

Analyst highlighted the IRDAI 25% promoter shareholding rule for CARE, where the Burman family's look-through is 18-19%, implying potential future actions or challenges.

Asked by Hitaindra Pradhan

LVB Fixed Deposits Status and Recovery Direct
So as far as LVB is concerned, Hitaindra, so the matter is subjudice right now in Delhi High Court. And the LVB has been replaced by DBS since LVB was taken over by DBS. ... So entire FD amount, Hitaindra of INR750 crores has been provisioned in RFL.

Analyst inquired about the long-standing LVB fixed deposits issue, and management confirmed the ₹750 crore provision and ongoing subjudice status, with recovery efforts in progress.

Asked by Hitaindra Pradhan

Religare Broking ROE Improvement Plan Partial
The ROE numbers we have not worked out. Right now our priorities remain to improve our digital offering as well as our presence in our large cities and work on the productivity of our resources that are already deployed in the business.

Analyst questioned the low single-digit ROE for broking and asked for a pathway to higher ROE, but management stated that specific targets are not yet set, focusing instead on operational improvements.

Asked by Hitaindra Pradhan

Disclosure of Care Health IFRS Numbers Evasive
So we're in the process of preparation of these IFRS numbers and maybe from next quarters or next to next quarter, we would be publishing those numbers.

Analyst pressed for IFRS numbers for Care Health, which are typically higher than reported, but management deferred disclosure to future quarters, citing ongoing preparation.

Asked by Ravi Purohit

Timeline for RFL Business Restart Partial
Well, I mean, Chintan, I can't really comment on month-on-month or quarter-on-quarter expectations. But as I said, a lot of legacy issues are out. There is much more regulatory clarity. ... to our mind, we are sort of seeing convergence of various efforts, and it should finally culminate into a tangible start-up of the business very soon.

Analyst sought a specific timeline for the restart of RFL's lending business, but management provided a qualitative response, indicating it would happen 'very soon' after resolving legacy issues and regulatory clarity.

Asked by Chintan Mehta

4 min read 7 chapters

Detailed narrative

Q3 & 9M FY26 Consolidated Performance Overview

Religare Enterprises reported a consolidated total income of ₹2,067.9 crores for Q3 FY26, marking a 23.8% year-on-year growth from ₹1,670.2 crores. For the nine months ended December 31, 2025, the total income was ₹6,033.1 crores, up 12.6% from ₹5,355.6 crores in the prior year. Despite revenue growth, the group recorded a negative PBT of ₹103.1 crores for 9M FY26, an increase from the negative PBT of ₹78.9 crores in the same period last year, influenced by one-time employee benefit provisions.

Strategic Demerger of Financial Services Business

The company announced a strategic demerger of its financial services business from its insurance business, aiming to create two focused and independent listed entities. This initiative is driven by the Burman Group's takeover, recent capital raise, and the need for specialized focus as businesses scale. The demerger involves transferring the lending, broking, and ancillary support services under Religare Enterprises Limited (REL) to Religare Finvest Limited (RFL), which will then be listed. REL will retain its stake in Care Health Insurance, and RFL will issue fully paid-up equity shares to REL shareholders in a 1:1 ratio. The entire process is expected to take 15-18 months, culminating in Q1 FY28.

Care Health Insurance: Strong Growth Amidst Accounting Changes

Care Health Insurance demonstrated robust performance, with its retail business growing 41% year-on-year on a full premium basis in Q3 FY26. The company's AUM crossed the ₹10,000 crore milestone, and its investment book reached ₹10,246 crores, yielding 7.2%-7.3%. On a full premium basis, 9M FY26 PBT was ₹265 crores, significantly up from ₹92 crores last year, with underwriting results improving by 23%. However, the new 1/n accounting methodology, which defers premium and profit recognition, resulted in a lower reported top line by ₹734 crores and profitability by ₹354 crores for 9M FY26 compared to the full premium basis, though this is a timing difference, not an economic loss.

Religare Broking: Revenue and Profit Surge

Religare Broking reported a strong Q3 FY26, with revenue increasing 11.6% year-on-year to ₹91 crores. Its Profit Before Tax (PBT) saw a remarkable 842% surge to ₹6.6 crores, up from ₹0.7 crores in the previous year. The client debit book (MTF) grew 93% year-on-year to ₹317 crores, and the e-governance business expanded by 21% year-on-year. Assets under custody reached ₹42,642 crores, reflecting healthy growth. The company is focusing on increasing its active client ratio (currently 14% vs industry 21%) and enhancing its digital platform for future growth.

Religare Finvest & Housing Finance: Stable Asset Quality and Capital

Religare Finvest Limited (RFL) maintains a strong financial position with a core SME book of ₹70 crores and a cash balance of ₹480 crores. Its collection efficiency stands at 99%, and Net NPA is stable at 1%, with a robust CRAR of 228%. The company's net worth exceeds ₹800 crores. Religare Housing Finance, focusing on affordable housing, reported an AUM of ₹241 crores with an average ticket size of ₹10 lakhs. It achieved a collection efficiency of 97.36% and a CRAR of 132%, supported by a capital base of ₹184 crores. Both entities are poised for growth post-demerger, with RFL planning to leverage its unlevered position to industry standards.

Capital Infusion and Strategic Deployment

The company has received ₹410 crores from its ₹1,500 crore warrant issue, comprising ₹375 crores in upfront premium and ₹35 crores from warrant conversion. Of this, ₹256 crores has been infused into Care Health Insurance via a rights issue. The remaining funds have been provided as loans to broking and housing subsidiaries. Management confirmed that ₹600 crores is earmarked for Care Health and ₹900 crores for the financial services businesses, aligning with the original capital allocation plans to support growth and strategic initiatives across the group.

Strengthening Leadership and Governance

Religare has significantly strengthened its leadership and governance. The Board has been reconstituted with three promoter nominees added in July 2025, and the induction of three promoter family members (Dr. Anand Burman, Mr. Mohit Burman, Mr. Aditya Chand Burman) and Mr. Jimeet Modi from SAMCO Group as additional directors is proposed, subject to regulatory approvals. Key leadership appointments include Mr. Vijay Goel as MD of Religare Broking, Mr. Babu Rao as Group General Counsel and Chief Compliance Officer, and Mr. Indranil Choudhury as Group CHRO, reinforcing the group's focus on robust operating foundations and value-accretive investments.

This is an AI-generated summary of a publicly available earnings call transcript.
View original transcript

More Financial Services earnings calls