HomeFirst profit jumps 42.75% as costs outpace revenue
Standalone operating margin narrowed 1.58 percentage points YoY, though it remained 18.83 points above the 52-peer sector median.
Filed 06 May 2026, 17:41 IST · after market close · Home First Finance Company India Ltd (HOMEFIRST)
Key takeaways
- Standalone net profit grew +42.75% YoY, helped by a 0.64 percentage-point fall in the tax rate.
- Revenue grew +20.92% YoY, but expenses rose +30.43%, narrowing operating margin by 1.58 percentage points.
- Management reported record Q4 disbursement of Rs 1,572 crore, up +23.5% YoY and +19.3% QoQ.
Price around the results
Profit growth outpaced operating profit
HomeFirst's standalone revenue increased +20.92% YoY, but expenses grew faster at +30.43%, limiting operating profit growth to +18.52%. Operating margin therefore narrowed 1.58 percentage points YoY and 0.64 percentage points QoQ. Net profit still rose +42.75% YoY as interest expense grew only +2.63% and the tax rate fell 0.64 percentage points. Other income was just 1.71% of pre-tax profit, so it was not a major driver of reported earnings.
Margin remains well above the sector median
Sequentially, revenue grew +3.97% while expenses rose +7.13%, causing the quarterly margin contraction. Operating margin has declined for two consecutive quarters and is down from 80.08% in Q3FY25 to 78.24% in Q4FY26. It nevertheless stood 18.83 percentage points above the 59.41% median for the 52 Financial Services peers that had reported.
Disbursement and asset quality improved
Management said Q4 disbursement reached an all-time high of Rs 1,572 crore, while 1+ DPD improved to 4.7%, 30+ DPD to 3.2% and GNPA to 1.8% QoQ. The company said it expects approximately 25% YoY AUM growth in FY27, driven by wider distribution, technology integration, diversified funding and risk governance. Management also guided to credit cost of 30–40 bps as it scales, while the presentation said HomeFirst raised Rs 280 crore from IFC for affordable and green housing.
The post-results decline was unusually large
The stock fell 0.74% on the result day and 11.28% after five sessions, compared with a median absolute move of 4.79% across eight prior result reactions. The day-one move was modest relative to its history, but the five-session decline was materially larger than its typical reaction. The reaction period also overlapped with a corporate action.
Q4FY26 at a glance
Standalone figures as filed with NSE — cross-checked against an independent source.
| Line item | Q4FY26 | Q3FY26 | QoQ | YoY |
|---|---|---|---|---|
| Revenue | ₹501 cr | ₹482 cr | +3.97% | +20.92% |
| Other income | ₹3 cr | ₹1 cr | +132.87% | +117.65% |
| Expenses | ₹109 cr | ₹102 cr | +7.13% | +30.43% |
| Operating profit | ₹392 cr | ₹380 cr | +3.13% | +18.52% |
| Operating margin (%) | 78.24% | 78.88% | — | — |
| Interest | ₹195 cr | ₹194 cr | +0.63% | +2.63% |
| Depreciation | ₹5 cr | ₹5 cr | +4.51% | +17.78% |
| Profit before tax | ₹195 cr | ₹183 cr | +6.76% | +41.54% |
| Tax | ₹46 cr | ₹43 cr | +7.30% | +37.77% |
| Net profit | ₹149 cr | ₹140 cr | +6.59% | +42.75% |
| EPS (₹) | ₹14.35 | ₹13.52 | +6.14% | +23.18% |
Operating margin of 78.24% compares with a Financial Services sector median of 59.41% across 52 peers that have reported Q4FY26.
How the stock reacted
| Window | Stock | vs NIFTY |
|---|---|---|
| Results day | -0.74% | -0.72% |
| Next session | -2.14% | — |
| 5 sessions | -11.28% | -8.65% |
| 15 sessions | -13.16% | — |
| 30 sessions | -5.93% | — |
Volume on the results session was 3.96× its 20-day average.
What management said
From the company’s own investor presentation. Each point is checked against the source document before it appears here.
This quarter
- Q4 disbursement rose 23.5% YoY and 19.3% QoQ to an all-time high of ₹1,572 crore.
- Early-stage delinquencies and GNPA improved QoQ, with 1+ DPD at 4.7%, 30+ DPD at 3.2% and GNPA at 1.8%.
Guidance & outlook
- The company guides credit cost at 30–40bps as it scales.
- The company expects approximately 25% YoY AUM growth in FY27.
- The company expects FY27 AUM growth to be driven by distribution expansion, technology integration, diversified funding and risk governance.
New products
- HomeFirst raised funding from IFC to finance affordable housing and green housing through a partnership promoting energy-efficient Green Homes.
New initiatives
- The company certified 140 additional homes under its Green Homes initiative during the quarter, reaching 450 cumulatively.
Problems & risks
- The company said India’s macroeconomic stability faced a global landscape disturbed by Middle Eastern conflicts and shifting trade dynamics.
What to watch
- Whether standalone operating margin holds above 78.24% after two consecutive quarterly declines.
- Reported credit cost against management's 30–40 bps guidance.
- AUM growth against management's approximately 25% YoY FY27 expectation.