Sammaan Capital Limited — Q3 FY26 earnings call

Call held 4 Feb 2026

Management summary

Sammaan Capital reported a strong Q3 FY26, with net worth growing to INR22,423 crores and a 9-month PAT of INR957 crores, a significant improvement from the previous year's loss. Asset quality remained stable with GNPA at 1.2% and NNPA at 0.7%. The company is progressing with the merger of Sammaan Finserve and awaiting regulatory approvals for the preferential allotment to IHC, while also navigating an ongoing Public Interest Litigation. Management outlined plans for increased leverage, dividend payouts, and continued focus on technology and co-lending to drive future growth.

Highlights

  • Net worth increased by approximately INR6,000 crores, standing at INR22,423 crores.

  • AUM stands at about INR44,000 crores.

  • PAT for the quarter was INR314 crores, up from INR302 crores.

  • 9-month PAT was INR957 crores, a significant turnaround from a loss of INR2,132 crores in the prior year.

  • Asset quality remains stable with Gross NPA at 1.2% (down from 1.3% in FY25) and Net NPA at 0.7% (down from 0.8%).

  • Successful track record of AIF platform, lending approximately INR6,200 crores with good returns.

  • Significant debt reduction of INR76,000 crores and INR55,000 crores interest paid, ensuring timely cash flow to lenders.

Concerns

  • Ongoing Public Interest Litigation (PIL) continues to be a matter of concern for stakeholders, despite favorable court rulings.

  • Business volumes from co-lending arrangements are expected to be slow for the first two quarters of operationalization.

Key financials

  1. Net Worth ₹22,423 Cr +36.5%YoY
  2. AUM ₹44,000 Cr
  3. PAT (9-month) ₹957 Cr
  4. PAT (Quarter) ₹314 Cr +4%YoY
  5. Gross NPA 1.2% -7.7%YoY
  6. Net NPA 0.7% -12.5%YoY
  7. Gearing 2.2×

What they filed

Q1 FY27: revenue down 31.8%, net profit down 23.9% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue2,066 1,902 1,880 2,192 2,063 −0%2,046 +8%1,215 −35%1,494 −32%
Net profit111 282 294 297 275 +148%285 +1%-8,455 −2976%226 −24%
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.

Capital allocation

high confidence
  • M&A Sammaan Finserve Merger · Pending regulatory

    consolidation of our lending business and distribution will enable Sammaan Capital to offer a full suite of mortgage-backed loans.

    To start off, in this quarter, one of the major developments was the announced proposed merger of our subsidiary, Sammaan Finserve into Sammaan Capital.

Guidance & targets

Cost Savings

  • Opex Cost Savings Cost Savings · once all of the tech kicks in · Medium confidence 15% to 18%
    And once all of the tech kicks in, we expect on an operating basis, something like a 15% to 18% cost saving in the business that we do on an opex basis.

    — Gagan Banga

Business Volumes

  • Business Volumes Growth Business Volumes · by May, June of next year · Medium confidence keep increasing to steady again
    And month-on-month, we expect the business volumes to keep increasing to steady again by May, June of next year.

    — Gagan Banga

Branch Expansion

  • Branches Added per Quarter Branch Expansion · a quarter · High confidence about 10
    So these will be Tier 3 and Tier 4 type of cities. I don't know the names offhand. And as of right now, our pace is calibrated, so we will look at only adding about 10 branches a quarter.

    — Gagan Banga

City Expansion

  • Total Cities Covered City Expansion · over the course of the next 2 financial years · High confidence 400 to 500 cities
    We've made a blueprint as to how do we get to about 400 to 500 cities very, very quickly over the course of the next 2 financial years.

    — Gagan Banga

Asset Quality

  • Annualized Credit Cost Asset Quality · longer-term basis · High confidence 100 basis points
    So what we've guided on the cost of credit is on a longer-term basis, an annualized credit cost of 100 basis points.

    — Gagan Banga

  • Legacy Book Outstanding Asset Quality · till the time that the legacy book does not become a single-digit · High confidence below INR10,000 crores
    We had also spoken about the fact that till the time that the legacy book does not become a single-digit below as in INR10,000 crores, we will continue to use these provisions being released to stay as provisions and to facilitate the recovery, which is what we are doing.

    — Gagan Banga

Leverage

  • Gearing Ratio Leverage · sometime around 2030 · High confidence 4x to 4.5x
    As our cost of funds reduce, as the ratings probably improve, the leverage, which is about 2.2x, should settle in the range of 4x to 4.5x. That is the go-to long-term for the company, which I believe we should be hitting sometime around 2030.

    — Gagan Banga

Shareholder Returns

  • Dividend Payout Ratio Shareholder Returns · over a longer-term · High confidence 30% to 40%
    Conservatively, we believe that we should be in the 30% to 40% sort of dividend payout ratio over a longer-term, basis all the calculations of RoA and capital that we have simulated.

    — Gagan Banga

Recoveries

  • Total Recoveries from Write-offs Recoveries · over the next 3 years · High confidence INR4,500 crores
    On a net basis, over the next 3 years, once we are done with all of these provisions and the legacy book has run down, we should be able to cash recover about INR4,500 crores.

    — Gagan Banga

Cost of Funds

  • Incremental Cost of Borrowing Cost of Funds · quickly right after this investment is to come through · High confidence below 8%
    Right now, we are borrowing at, give or take 9%. And we expect, as I said, a movement down to below 8% quickly right after this investment is to come through.

    — Gagan Banga

  • Overall Stock Cost of Borrowing Reduction Cost of Funds · by the end of March '27 · High confidence down by about 270 basis points
    On an overall stock basis, we would expect that in about 9 months to 12 months, the cost of funds should go down by about 270 basis points. That's what the goal is that by the end of March '27, assuming that we are able to get this done very quickly by the end of March '27, the stock of borrowing should be down by a cost of about 270 basis points.

    — Gagan Banga

What to watch in Q4 FY26

RBI Approval for IHC Preferential Allotment

Next quarter (implied)
Current Awaiting approval, everything on track.
Target Approval granted.

Why it matters

This approval is fundamental for the capital infusion and the company's strategic transformation under IHC.

We await RBI approval for the preferential allotment and SEBI approval for the open offer. Post that, it will take about 15 days for the shares to get allotted and the monies to be received by the company.

Risks & concerns

  • Public Interest Litigation (PIL)

    high

    Ongoing PIL against erstwhile promoter, company is a party. Despite favorable Delhi High Court ruling and regulatory affidavits, the matter is now in Supreme Court. Management believes no financial loss to Sammaan Capital.

    Management acknowledged

  • Regulatory Approvals for Preferential Allotment

    medium

    Awaiting RBI and SEBI approvals for the preferential allotment to IHC, which is crucial for the company's strategic transformation and capital infusion.

    Management acknowledged

  • Slow Business Volumes from Co-lending Operationalization

    low

    The first 2 quarters of operationalizing new co-lending arrangements are expected to be relatively slow as integration with banks continues.

    Management acknowledged

Q&A highlights

5 direct, 1 evasive
Capital utilization and leverage strategy post preferential issue Direct
As our cost of funds reduce, as the ratings probably improve, the leverage, which is about 2.2x, should settle in the range of 4x to 4.5x. That is the go-to long-term for the company, which I believe we should be hitting sometime around 2030.

Clarifies the long-term capital structure and leverage targets, indicating a shift from asset-light to more balance sheet-driven growth.

Asked by Amish Kanani

RBI approval status for IHC preferential allotment Direct
Nitin, we are awaiting the approval itself. So it's not as if RBI has granted and there is some specific condition. RBI will approve the preferential allotment... As of right now, everything is on track, and we are progressing very well.

Provides an update on a critical regulatory approval necessary for the capital infusion and strategic transformation.

Asked by Meet Nitin Mewada

Expansion plans for e-mortgage loans and new branches Direct
So these will be Tier 3 and Tier 4 type of cities... we will look at only adding about 10 branches a quarter. We've made a blueprint as to how do we get to about 400 to 500 cities very, very quickly over the course of the next 2 financial years.

Details the company's geographical expansion strategy and pace of branch network growth, focusing on smaller cities.

Asked by Meet Nitin Mewada

Guidance on revenue and cost of credit for the next 2-3 years Partial
So what we've guided on the cost of credit is on a longer-term basis, an annualized credit cost of 100 basis points... I would say that any revenue guidance or anything of that sort would be more material and relevant, once we lay out the whole strategy for you.

Management provided specific credit cost guidance but deferred revenue guidance, indicating a significant strategic shift is pending and will impact future revenue.

Asked by Sambit Roy

Proportion and future trajectory of the legacy loan book Evasive
All of that has been detailed in fairly granular numbers, what is the AUM, what is the legacy, what is the growth, the direction in which it is going down. It's all there in the earning update. So in the interest of time, since it's already all detailed, I'll move to the next question, and I'm sure the answers are all there.

Analyst sought clarification on a key asset quality metric, but management declined to elaborate, referring to the earnings update, which could be seen as an evasion.

Asked by Sambit Roy

Total provisions and estimated time for recovery Direct
So we have given a collection number that out of all the write-offs, recovery and provisions that we have done, over a period of time, we will recover, give or take, INR4,500 crores... On a net basis, over the next 3 years, once we are done with all of these provisions and the legacy book has run down, we should be able to cash recover about INR4,500 crores.

Provides a clear target for future recoveries from the legacy book and a timeline, which is crucial for understanding the tail-end of asset quality issues.

Asked by ASN. Raju

Incremental cost of borrowing and uptick in interest expense Direct
Right now, we are borrowing at, give or take 9%. And we expect, as I said, a movement down to below 8% quickly right after this investment is to come through... On an overall stock basis, we would expect that in about 9 months to 12 months, the cost of funds should go down by about 270 basis points... by the end of March '27.

Explains the current cost of funds, reasons for recent uptick (aggressive borrowing), and provides clear forward guidance on expected cost of funds reduction post-investment.

Asked by Faizaan Joad

3 min read 7 chapters

Detailed narrative

Strategic Consolidation and Capital Infusion

Sammaan Capital announced the proposed merger of its subsidiary, Sammaan Finserve, into Sammaan Capital, aiming to consolidate lending and distribution for a full suite of mortgage-backed loans. This move is a logical step following the proposed preferential allotment to IHC. The company is actively engaged with regulators for approvals for this capital infusion, which is expected to finalize soon, with the process having entered its final stages.

Robust Financial Performance in Q3 FY26

The company reported a strong financial quarter, with net worth increasing by approximately INR6,000 crores to INR22,423 crores. AUM reached INR44,000 crores. Profit after tax for the quarter was INR314 crores, up from INR302 crores. For the nine months, PAT stood at INR957 crores, a significant turnaround from a consolidated loss of INR2,132 crores in the prior year.

Stable Asset Quality and Product Evolution

Asset quality remained stable, with Gross NPA at 1.2% (down from 1.3% in FY25) and Net NPA at 0.7% (down from 0.8%). The product suite now includes four offerings: home loans for prime (INR30 lakh) and affordable (INR15 lakh) segments, and LAP loans for prime (INR75 lakh) and affordable (INR25 lakh) segments. The company continues to focus on its asset-light strategy, with 90 days past due on sold pools at 0.54%.

Co-lending and Technology-driven Operations

Sammaan Capital is actively operationalizing new co-lending arrangements, which are now broader than just priority sector loans, covering all loan types and financial entities. While initial business volumes are expected to be slow for the first two quarters, they are projected to return to original levels by May-June of next year. The company emphasizes technology, with digital lead onboarding, KYC, banking analysis, underwriting, and disbursal processes in place, aiming for 15-18% opex cost savings.

Update on Public Interest Litigation (PIL)

The long-running PIL, initially filed in 2019, remains sub judice in the Supreme Court. Despite previous dismissals by the Delhi High Court in February 2024 and regulatory affidavits confirming no major violations and full loan repayments, the matter continues. Management asserts no financial loss to Sammaan Capital, having earned INR3,017 crores in interest income from the loans in question, and is confident in its legal position.

Future Capital Structure and Growth Strategy

Post capital infusion and as cost of funds reduce, the company targets a long-term gearing ratio of 4x to 4.5x by 2030, up from the current 2.2x. Management also anticipates starting dividend payouts with a 30-40% payout ratio over the longer term. The company plans to expand its branch network by adding about 10 branches per quarter and reaching 400-500 cities within the next two financial years.

Cost of Funds and Recovery Outlook

The current incremental cost of borrowing is around 9%, but management expects it to drop below 8% quickly after the investment. The overall stock cost of funds is projected to decrease by about 270 basis points by March 2027. The company also expects to recover approximately INR4,500 crores from write-offs over the next three years, continuing to use provisions to facilitate these recoveries, with net collections of about INR5,000 crores this year.

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