LIC Housing Finance profit rose 9.46%, but the stock fell 4.31%
Lower expenses and interest costs supported standalone earnings, while management flagged a Q4 net interest margin decline to 2.80% from 2.85% a year earlier.
Filed 13 May 2026, 22:01 IST · after market close · LIC Housing Finance Ltd (LICHSGFIN)
Key takeaways
- Standalone net profit rose 9.46% year on year to lift EPS to Rs 27.22.
- Operating margin expanded 1.22 percentage points year on year as expenses fell 17.59% while revenue declined 1.22%.
- The stock fell 4.31% on the first trading day, a larger move than its 3.65% median absolute reaction after the past eight results.
Price around the results
Lower costs, not revenue growth, drove the earnings increase
LIC Housing Finance reported standalone net profit growth of 9.46% year on year despite a 1.22% revenue decline. Expenses fell 17.59% and interest costs fell 3.30%, lifting profit before tax by 9.31%. Other income contributed only 0.01% of pre-tax profit, so the earnings increase was not materially supported by this line.
Operating margin recovered, while net interest margin narrowed
Operating margin widened 1.22 percentage points year on year and 0.38 percentage points sequentially because expenses grew more slowly than revenue. The tax rate was broadly stable year on year, down 0.12 percentage points, but rose 2.00 percentage points sequentially and limited the sequential conversion of higher pre-tax profit into net profit. Management said Q4 net interest margin declined to 2.80% from 2.85% in Q4FY25.
Margin remains below the level seen a year earlier in the trend
The 93.84% operating margin was above Q3FY26's 93.46% but below the 95.91% recorded in Q3FY25. This quarter therefore marks a sequential recovery after the Q3 dip, rather than a continuation of the earlier decline. Across 52 Financial Services peers that had reported, the company's margin was 34.43 percentage points above the sector median of 59.41%.
Disbursements improved, with non-housing loans leading growth
Management said Q4 loan disbursements increased 10% to Rs 21,019 crore from Rs 19,156 crore. The company told investors that non-housing individual loan disbursements rose 25% to Rs 3,348 crore, and said it had introduced a captive marketing channel through direct marketing executives.
The market reaction was weaker than the stock's typical result-day move
The stock fell 4.31% on the first trading day after the results, with volume at 2.75 times the reference level, and was down 8.14% after five trading days. Across the past eight result reactions, the stock rose three times and fell five times; the latest first-day decline was larger than the 3.65% median absolute move. The results were filed after market close.
Q4FY26 at a glance
Standalone figures as filed with NSE — cross-checked against an independent source.
| Line item | Q4FY26 | Q3FY26 | QoQ | YoY |
|---|---|---|---|---|
| Revenue | ₹7,194 cr | ₹7,187 cr | +0.10% | -1.22% |
| Other income | ₹0 cr | ₹0 cr | +1700.00% | +350.00% |
| Expenses | ₹443 cr | ₹470 cr | -5.71% | -17.59% |
| Operating profit | ₹6,751 cr | ₹6,717 cr | +0.51% | +0.08% |
| Operating margin (%) | 93.84% | 93.46% | — | — |
| Interest | ₹4,787 cr | ₹4,942 cr | -3.13% | -3.30% |
| Depreciation | ₹30 cr | ₹33 cr | -8.33% | +17.35% |
| Profit before tax | ₹1,934 cr | ₹1,743 cr | +11.00% | +9.31% |
| Tax | ₹437 cr | ₹359 cr | +21.83% | +8.77% |
| Net profit | ₹1,497 cr | ₹1,384 cr | +8.20% | +9.46% |
| EPS (₹) | ₹27.22 | ₹25.16 | +8.19% | +9.45% |
Operating margin of 93.84% 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 | -4.31% | -5.49% |
| Next session | -6.59% | — |
| 5 sessions | -8.14% | -9.18% |
| 15 sessions | -6.13% | — |
| 30 sessions | -4.25% | — |
Volume on the results session was 2.75× 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 FY26 loan disbursements increased 10% to Rs. 21,019 crore from Rs. 19,156 crore.
- Q4 FY26 non-housing individual loan disbursements increased 25% to Rs. 3,348 crore.
New initiatives
- The company has introduced a new captive marketing channel through direct marketing executives.
Problems & risks
- Q4 FY26 net interest margin declined to 2.80% from 2.85% in Q4 FY25.
What to watch
- Whether operating margin holds above 93.84%.
- Whether net interest margin recovers from 2.80%.
- Whether non-housing individual loan disbursements sustain the 25% growth reported in Q4.