SBI Funds’ profit drops 20.54% as other income falls sharply
Standalone margin also narrowed as expenses grew much faster than revenue, although the 76.76% margin remained above the sector median.
Filed 23 Oct 2026, 17:37 IST · after market close · SBI Funds Management Ltd (SBIFUNDS)
Key takeaways
- Standalone net profit fell 20.54% QoQ to Rs 693.54 cr as other income dropped 81.94%.
- Operating margin narrowed 3.46 percentage points to 76.76% because expenses grew 21.45% against 3.37% revenue growth.
- SIP AUM rose 15% YoY to Rs 2.07 trillion, while unique customers increased 10% to 1.85 crore.
Price around the results
Other income drove the sequential profit decline
SBI Funds Management’s standalone revenue increased 3.37% QoQ, but operating profit fell 1.09% and net profit declined 20.54% to Rs 693.54 cr. Other income fell 81.94% to Rs 42.67 cr and accounted for 4.57% of pre-tax profit in the quarter, compared with Rs 236.27 cr in Q1FY27. The lower other-income contribution was the main reason pre-tax profit fell 18.38%.
Costs narrowed the margin despite revenue growth
Expenses grew 21.45% QoQ against 3.37% revenue growth, cutting operating margin by 3.46 percentage points. Interest expense rose 134.43% and depreciation increased 26.52%, while the tax rate also moved up 2.02 percentage points to 25.66%. At 76.76%, the operating margin was 12.26 percentage points above the 64.5% median of 23 Financial Services peers that had reported the quarter.
SIP and customer growth support the business update
Management said SIP AUM reached Rs 2.07 trillion, up 15% YoY, while unique customers rose 10% to 1.85 crore as of September 30, 2026. The company said it launched five mutual fund schemes in Q2FY27, including Magnum Hybrid Long Short Fund. Management said it plans to target first-time mutual fund investors, expand AIF and passive offerings, and launch a new outbound product; it also said AI and machine learning are being used across research, risk management, security, customer service, marketing and automation.
Results were filed after market close
The standalone results were filed at 17:37 IST on 23 October 2026, after market close. The stock’s post-results reaction is therefore not yet assessable.
Q2FY27 at a glance
Standalone figures as filed with NSE — filed ahead of third-party databases, not yet independently cross-checked.
| Line item | Q2FY27 | Q1FY27 | QoQ |
|---|---|---|---|
| Revenue | ₹1,187 cr | ₹1,149 cr | +3.37% |
| Other income | ₹43 cr | ₹236 cr | -81.94% |
| Expenses | ₹276 cr | ₹227 cr | +21.45% |
| Operating profit | ₹911 cr | ₹921 cr | -1.09% |
| Operating margin (%) | 76.76% | 80.22% | — |
| Interest | ₹6 cr | ₹2 cr | +134.43% |
| Depreciation | ₹15 cr | ₹12 cr | +26.52% |
| Profit before tax | ₹933 cr | ₹1,143 cr | -18.38% |
| Tax | ₹239 cr | ₹270 cr | -11.43% |
| Net profit | ₹694 cr | ₹873 cr | -20.54% |
| EPS (₹) | ₹3.40 | ₹4.29 | -20.75% |
Operating margin of 76.76% compares with a Financial Services sector median of 64.50% across 23 peers that have reported Q2FY27.
What management said
From the company’s own investor presentation. Each point is checked against the source document before it appears here.
This quarter
- SIP AUM stood at ₹2.07 trillion, up 15% year on year.
- Unique customers stood at 1.85 crore, up 10% as of September 30, 2026.
Guidance & outlook
- The company targets first-time mutual fund investors.
- The company plans to expand AIF offerings across categories.
- The company plans to launch a new outbound product.
Expansion
- The company plans to expand its passive product offerings.
New products
- Five new mutual fund schemes were launched.
- Magnum Hybrid Long Short Fund was launched in Q2 FY27.
New initiatives
- The company is using AI and machine learning across research, risk management, security, customer service, marketing and automation.
Competition
- The company continued to rank first among mutual fund managers, with a 15.0% market share.
- The company maintained the number-one rank in passive funds with a 27.4% market share.
What to watch
- Whether operating margin moves back from 76.76% after the 3.46-percentage-point QoQ decline.
- Whether expense growth moderates from 21.45% relative to revenue growth of 3.37%.
- The next update on SIP AUM from Rs 2.07 trillion and unique customers from 1.85 crore.