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Informist, Tuesday, Jul. 21, 2026

 

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--M&M Fincl: NIM should be around 7% in the medium term 
--CONTEXT: Comments by M&M Financial mgmt in post-earnings analyst call 
--M&M Fincl: Hold liquidity buffers worth INR 55 billion 
--M&M Fincl: Expect credit cost to remain between 1.3-1.7% in FY27 
--M&M Fincl: Expect to grow at compounded rate of 16-18% per year 
--M&M Fincl: Started co-lending with one bank in personal vehicle segment 
--M&M Fincl: Don't need to raise capital for 6-8 quarters 
 

 

By Nandini Sinha and Kabir Sharma

 

MUMBAI – Mahindra and Mahindra Financial Services Ltd. expects the net interest margin to remain around 7% in the medium term, the company's management told analysts at a post-earnings conference call Tuesday. The company is actively looking at product composition, pricing, as well as fee-based income and other initiatives to augment the margin. The company reported a net interest margin of 7.3% for the June quarter.

 

The non-banking financier has raised its traditional liquidity buffers by INR 55 billion to manage seasonality, the management said. The company has reported an improvement in its gross stage II and gross stage III assets, the management said. The total liquidity buffer at the end of the June quarter stood at INR 146.50 billion.

 

The company's credit cost is expected to be in the range of 1.3-1.7% in 2026-27 (Apr-Mar), the management said. "I've given this range across cycles because I do believe at the lower end... we'll be able to augment a lot of the tools to come close to the 1.3(%) number. We're already at a 1.5(%), but there could be times when things go south, and that's the 1.7(%) for those kinds of times," a senior official at the company said. 

 

Mahindra and Mahindra Financial's management said it expects the compounded annual growth rate for the franchise to be between 16–18%. "... the core business, which is the mobility business, will have to meet at a lower end compounded at 12%, and the new businesses will have to compound at a 30% plus," the management said.

 

The company has begun co-lending with one bank in the personal vehicle finance business, the management said. "There is only one playbook for co-lending, which is a system-to-system integration. So we were doing some business with some banks. We had to unplug that because of the system readiness," the management said.

 

The non-banking financial company sees no need for capital raising for at least six to eight quarters, the management said. 

 

The company posted a net profit of INR 8.99 billion for the reporting quarter on revenues of INR 49.72 billion. Tuesday, shares of the lender ended 8.5% higher at INR 349.85 apiece on the National Stock Exchange.  Mahindra and Mahindra Financial announced its results for the June quarter Tuesday during market hours. End 

 

Edited by Saji George Titus

 

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