Tata Capital Q1 Profit Jumps 56 %, Declares Ambitious Growth Plans on Gold Lending

Mumbai: Non-banking lender Tata Capital on Tuesday reported a 56 per cent jump in consolidated profit at Rs 1,547 crore in the June quarter on rise in core income and lower provisions as asset quality improved.

The Tata group company had reported a net profit of Rs 990 crore in the year-ago period.

The net interest income of the company increased 25 per cent year-on-year to Rs 3,571 crore in the June quarter on the back of a 22 per cent expansion in the assets under management to Rs 2.91 lakh crore.

Having recently entered the gold loan business through an acquisition, the company announced ambitious targets in the segment, including a five-time increase in AUM over the next three years.

Retail segment AUM of the company, excluding motor finance business, increased to Rs 1.43 lakh crore in the June quarter, from Rs 1.36 lakh crore in the March quarter, and Rs 1.18 lakh crore in June quarter last year, according to the investor presentation.

Motor finance AUM of the lender declined in the quarter under review to Rs 24,445 crore, from Rs 25,390 crore in the previous quarter, and Rs 30,374 crore a year earlier.

Within retail, home loan AUM stood at Rs 46,052 crore, loan against property AUM stood at Rs 41,250 crore, and personal or business loans AUM stood at Rs 26,202 crore, investor presentation showed.

SME AUM of the company increased to Rs 80,567 crore in the June quarter, from Rs 60,132 crore in the year-ago period, and corporate AUM stood at Rs 42,456 crore in the reporting quarter.

Rajiv Sabharwal, Managing Director and Chief Executive Officer, said AUM is expected to grow to around Rs 4,000-5,000 crore in the next three years from the Rs 708 crore now. It intends to grow to about 500 in the next few years.

“We have identified certain states, and work is on to identify more,” Sabharwal said during the post-earnings conference call.

Currently, the AUM of the gold loan business stood at Rs 708 crore as on March, 2026, and 162 branches across southern states of the country.

On July 13, Tata Capital acquired majority stake in Kerala-based Yogakshemam Loans (Yogloans). The proposed all-cash transaction, subject to regulatory approvals, values Yogloans at a pre-money equity valuation of up to Rs 318 crore and includes a primary capital infusion of about Rs 93 crore to support the company’s growth plans.

Sabharwal said the approval for the acquisition of Yogloans is expected by the end of this calendar year.

In the reporting quarter, asset quality of the lender, including motor finance business, improved with gross stage 3 ratio stood at 1.9 per cent in the June quarter, as compared to 2 per cent in the March quarter, and 2.1 per cent in the June quarter last year.

On the Tata Capital Housing Finance, Sabharwal said the board of directors have discussed for unlocking value in the company, but have not made any decision on this.

“At the board, we do discuss this, but we’ve not made any decision on this. We will wait for RBI directions when they do place us in the upper layer, and from that time, they do give us about three years to make that decision of when to list or when not to list. So, we will comply with those guidelines once we are placed in the upper layer,” Sabharwal said.

Meanwhile, net profit of Tata Capital Housing Finance, a wholly owned subsidiary of Tata Capital increased 29 per cent year-on-year in Q1, FY27 to Rs 532 crore from Rs 412 crore in Q1FY26.

Assets under management grew 24 per cent year-on-year to Rs 89,416 crore as of June 30, 2026 from Rs 71,913 crore as of June 30, 2025.

The Tata Capital scrip closed 1.21 per cent up at Rs 354.95 a piece on the BSE on Tuesday as against a marginal correction on the benchmark.

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