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Informist, Thursday, Jan. 22, 2026

By Shruti Nair

MUMBAI – Mahindra & Mahindra Financial Services Ltd. is expected to report a notable increase in its December quarter net interest income on the back of increased disbursements, according to brokerages tracking the company.

The company's net profit is expected at INR 7.36 billion, as per the average of estimates from 11 brokerages, up over 29% on quarter but down more than 18% on year. Kotak Securities Ltd. has the highest estimate for net profit at INR 8.91 billion and Nirmal Bang Equities Pvt. Ltd. has the lowest estimate at INR 5.68 billion.

M&M Financial's net interest income is expected at INR 22.86 billion for the December quarter, up over 8% sequentially and almost 20% from the same quarter a year ago, according to the average of estimates. The highest estimate for the company's net interest income is from YES Securities (India) Ltd. at nearly INR 25 billion, while the lowest estimate is from Nuvama Wealth Management Ltd. at INR 21 billion.

Moderating credit cost are expected to boost the company's sequential bottom line which will also benefit from improved collection efficiency and stable asset quality. The credit cost for the trailing quarter was 2.2%. However, on a year-on-year basis, the credit cost is expected to see an increase between 143 and 180 basis points. Credit cost for the year-ago quarter was close to 0.03% at INR 90 million, driven by a steep decline of INR 4.34 billion in provisions.

The company's net interest margin for the reporting quarter is expected to rise between 20 and 120 bps on year, from 6.6% in the same quarter last year. However, analysts were divided on the company's sequential net interest margin, with some foreseeing a marginal decline while others expecting a slight increase. The company's net interest margin in trailing quarter was 7%.

The increase in the net interest margin would be on the back of a decline in cost of borrowings owing to a reduction in the Reserve Bank of India's repo rate, according to Mirae Asset Sharekhan Ltd. and ICICI Securities.

M&M Financial's December quarter disbursements were around INR 175 billion, a 7% on-year growth and a 30% sequential growth. The improvement in disbursements was driven by a pent-up demand due to the cut in the goods and services tax that was announced several days before it took effect and festival-season demand.

Consequently, the company's business assets were INR 1.29 trillion in the December quarter, representing an almost 12% growth on year and more than 1% on quarter increase.

Out of the 10 brokerage reports on the company available with Informist, six have a 'buy' recommendation on the stock with an average target price of INR 340 per share. This is more than 6% higher than the current market price. Three brokerages have recommended 'hold' with an average target price of INR 301 per share and one has a 'sell' recommendation on the stock at an average target price of INR 280.

Shares of M&M Financial's closed at INR 360.45 on the National Stock Exchange Thursday, up over 3%. Shares have risen over 20% since it declared its September quarter earnings on Oct 28.

M&M Financial is scheduled to release its quarterly earnings Wednesday.

The non-banking financial company originated as a captive financier of Mahindra & Mahindra Ltd. and then expanded its reach to other original equipment manufacturers, eventually establishing its presence in the rural and semi-urban vehicle financing segment.

Following are the December quarter earnings estimates for Mahindra & Mahindra Financial Services from eight brokerage firms in descending order of the estimate of net profit in INR billion:

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IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

Edited by Akul Nishant Akhoury

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