Aye Finance Reports 144% Profit Surge in Q1 FY27 Driven by Lower Credit Costs and Operational Leverage
Aye Finance Ltd, a leading technology-driven NBFC specializing in micro-enterprise lending, announced its unaudited financial results for the first quarter of fiscal year 2026-27. The company reported robust year-on-year growth across key performance indicators, highlighted by a significant surge in profit after tax (PAT).The Q1 FY27 results reflect tighter risk discipline and compounding benefits of scale, resulting in a substantial increase in profitability for the NBFC. Aye Finance Ltd maintained prudent financial management while expanding its lending operations across micro-scale MSMEs.
Financial Performance Snapshot
The company showcased strong growth metrics despite prevailing market concerns regarding geopolitical tensions and El Niño.| Metric | Q1 FY27 Value | Comparative Data / Notes |
|---|---|---|
| Profit After Tax (PAT) | INR 74.5 Crores | Grew 144% YoY from INR 30.6 Crores |
| Assets Under Management (AUM) | INR 7,324 Crores | 28% YoY Growth from INR 5,721 Crores |
| Net Worth | INR 2,603 crores | Annualised EPS at Rs. 12.08 |
| Gross NPA (GNPA) | 4.49% | Down from the previous quarter |
| Net NPA (NNPA) | 1.67% | Down by 12bps from the previous quarter |
| Credit Cost | 4.01% | Six quarters of continuous reduction, down from 4.30% in Q4 FY26 |
| Return on AUM (RoAUM) | 4.2% | |
| Return on Equity (RoE) | 11.7% | Reflecting the impact of the primary raise through the IPO in Q4 |
Business and Asset Quality Highlights
Aye Finance Ltd demonstrated effective credit underwriting and market demand across its operational segments. The company saw a strong increase in both asset size and lending volume, supported by improving asset quality metrics.Key business highlights for Q1 FY27 include:
- Disbursement Growth: Disbursement grew 22% YoY, increasing from INR 1,001 Crores to INR 1,219 Crores, keeping the company on track for a targeted annual growth of 25-30%.
- Customer Acquisition: The addition of new borrowers stood at 44,736 in Q1 FY27, representing a 38% YoY improvement.
- Portfolio Health: The Principal Amount Outstanding (PAR) for Bucket X remained at 7.01%, even considering the typical effects of a seasonally softer quarter.
The company proactively enhanced its prudential reserves, increasing its PCR by 14bps to 63.80% Quarter-on-Quarter (QoQ).
Management Commentary
Mr Sanjay Sharma, Managing Director of Aye Finance Ltd, commented on the strong performance, stating, “Our Q1 FY27 performance reflects the robustness of our cluster-based underwriting model in serving India's micro-enterprise segment. We delivered 144% improvement in PAT and 28% growth in AUM YoY, accompanied by a 29bps reduction in our credit costs.” He added that the improved asset quality alongside strong profitable growth demonstrates the management’s philosophy of scaling up with good credit discipline.About Aye Finance Ltd
Aye Finance is a non-banking financial company (NBFC-ML) dedicated to providing loans to micro-scale MSMEs across India. The firm provides various business loans for working capital and business expansion needs, secured either against hypothecation of working assets or property security. Aye serves the largely underserved micro-scale enterprises in 18 states and 3 union territories. As of June 2027, the company has Assets Under Management (AUM) totaling ₹ 7,324 Crores. Aye offers small ticket business loans with an Average Ticket Size (ATS) on disbursement of ₹0.17 million to micro enterprises.AYE Stock Price Movement
As of 12:01 PM, shares of Aye Finance Limited are shedding value in live trading, slipping by 3.40% to reach ₹182.7. The stock is experiencing significant movement as over 3.07 million shares trade through the current market session.Disclaimer: Due care and diligence have been taken in compiling and presenting news and market-related content. However, errors or omissions may arise despite such efforts.
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