INDOSTAR - Indostar Capital
📢 Recent Corporate Announcements
IndoStar Capital Finance reported a standalone Profit After Tax (PAT) of ₹8.25 crore for Q3 FY26, down from ₹11.41 crore in the previous year's corresponding quarter. The nine-month (9M FY26) PAT reached a significant ₹554.16 crore, primarily due to a one-time exceptional gain of ₹1,175.95 crore from the sale of its subsidiary, Niwas Housing Finance. Total revenue from operations for the quarter stood at ₹346.33 crore, showing a slight decline year-on-year. The company also accounted for a ₹4.8 crore impact on employee expenses following the notification of new Government Labour Codes.
- Standalone PAT for Q3 FY26 stood at ₹8.25 crore compared to ₹11.41 crore in Q3 FY25.
- Exceptional gain of ₹1,175.95 crore recorded in 9M FY26 from the divestment of Niwas Housing Finance (NHFPL).
- Finance costs decreased to ₹137.13 crore in Q3 FY26 from ₹192.98 crore in the same quarter last year.
- Impairment on financial instruments rose to ₹76.92 crore in Q3 FY26 from ₹47.94 crore YoY.
- Stressed loans with an aggregate principal of ₹343.66 crore were transferred to ARCs during the nine-month period.
IndoStar Capital Finance reported a 20% sequential growth in disbursements to ₹1,117 crores for Q3 FY26, driven primarily by the vehicle finance segment. The company's total AUM reached ₹7,692 crores, while Net Interest Income grew 16.1% year-on-year to ₹209 crores. Asset quality showed significant improvement, with delinquency levels in the 2025 cohort being 50% lower than previous years. Management is focusing on retail-led growth through used vehicle finance and Micro LAP, supported by a digital-first approach.
- Total disbursements rose 20% QoQ to ₹1,117 crores, with vehicle finance contributing ₹1,087 crores.
- Net Interest Income (NII) increased by 16.1% YoY to ₹209 crores for the quarter.
- Asset quality improved significantly, with the 2025 cohort showing 50% lower delinquency levels than previous cohorts.
- Micro LAP segment AUM reached ₹128 crores with a collection efficiency near 100% and only 6 customers in 1+ DPD.
- Completed preferential allotment of 2.5 crore shares to promoters and Florintree upon warrant conversion.
IndoStar Capital Finance Limited has approved the allotment of 798 equity shares following the exercise of stock options under the IndoStar ESOP Plan 2018. This allotment results in a very marginal increase in the company's paid-up equity share capital, which now stands at approximately INR 161.54 crore. The total number of equity shares has increased from 16,15,36,468 to 16,15,37,266. Given the extremely small number of shares issued, there is no meaningful dilution for existing shareholders.
- Allotment of 798 equity shares of face value INR 10 each pursuant to ESOP exercise
- Paid-up equity capital increased to INR 1,61,53,72,660 from INR 1,61,53,64,680
- Total outstanding equity shares increased to 16,15,37,266
- Allotment approved by Managing Director Randhir Singh under Board authority
IndoStar Capital Finance Limited has released the audio recording of its conference call held on February 10, 2026. The call focused on the unaudited standalone and consolidated financial results for the quarter and nine months ended December 31, 2025. This disclosure provides investors with access to management's detailed commentary on the company's recent performance and strategic outlook. The recording is available on the company's official website as per SEBI regulatory requirements.
- Audio recording of the Q3 FY26 earnings conference call is now available for public access.
- The call was conducted on February 10, 2026, following the announcement of financial results.
- Covers financial performance for the nine-month period ending December 31, 2025.
- The recording link is hosted on the company's investor relations portal under audio/video recordings.
IndoStar Capital Finance reported strong operational growth in Q3FY26, with disbursements rising 20% QoQ to ₹1,117 crore and AUM reaching ₹7,692 crore. While Pre-provision operating profit (PPOP) surged 43.5% YoY to ₹85.2 crore, Profit After Tax (PAT) fell 27.7% YoY to ₹8.3 crore, primarily due to a one-time ₹4.8 crore regulatory wage code impact. The company demonstrated improved efficiency with a 67 bps YoY reduction in cost of funds to 10.09% and a 70 bps improvement in yields. Asset quality remains stable with Gross Stage 3 at 4.06% and a very healthy Capital Adequacy Ratio of 41.4%.
- Disbursements grew 20% QoQ to ₹1,117 crore, led by 21% growth in Vehicle Finance.
- Pre-provision operating profit (PPOP) increased 43.5% YoY to ₹85.2 crore driven by yield expansion.
- Cost of funds improved by 67 bps YoY to 10.09% through the 'LEAP' cost optimization initiative.
- Standalone PAT of ₹8.3 crore includes a one-time ₹4.8 crore impact from regulatory changes in the Wage Code.
- Capital Adequacy Ratio (CAR) stands strong at 41.4% with low leverage of 1.2x following warrant conversions.
IndoStar Capital Finance reported a PAT of ₹8.3 crore for Q3FY26, a decline from ₹11.4 crore in the previous year. While overall AUM saw a slight year-on-year dip to ₹7,692 crore, Net Interest Margins (NIM) showed significant improvement, rising to 8.6% from 5.4% a year ago. The company is successfully transitioning to a retail-centric model, with Micro LAP AUM growing over 6x to ₹128 crore. Asset quality remains a point of focus as Gross Stage 3 assets rose sequentially to 4.06% from 3.04% in Q2FY26.
- Net Interest Margin (NIM) improved significantly to 8.6% in Q3FY26 compared to 5.4% in Q3FY25.
- Micro LAP segment showed robust growth with AUM reaching ₹128 crore, up from ₹19 crore in the previous year.
- Capital Adequacy Ratio remains very healthy at 41.4%, providing a strong cushion for future growth.
- Gross Stage 3 assets improved year-on-year to 4.06% but showed a sequential increase from 3.04% in Q2FY26.
- Total disbursements for the quarter stood at ₹1,117 crore, showing a recovery from the previous quarter's ₹927 crore.
IndoStar Capital Finance has approved its unaudited financial results for the quarter and nine months ended December 31, 2025. The company disclosed the full utilization of approximately ₹201.33 crore raised through two preferential issues in late 2025. These funds were entirely directed toward growth objectives, specifically for onward lending in commercial vehicle, housing, and SME finance. The absence of any deviation in fund usage reflects management's commitment to expanding the core lending business.
- Approved Q3 and 9M FY26 unaudited standalone and consolidated financial results.
- Utilized ₹149.99 crore raised on Nov 24, 2025, for onward lending and capital augmentation.
- Utilized ₹51.33 crore raised on Dec 20, 2025, for growth objectives in retail and SME segments.
- Reported zero deviation in the utilization of proceeds from preferential issues.
- Trading window for designated persons to reopen on February 12, 2026.
IndoStar Capital Finance has confirmed zero deviation in the utilization of funds raised through preferential issues of warrants during the quarter ended December 31, 2025. The company raised approximately Rs 150 crore on November 24 and an additional Rs 51.3 crore on December 20, totaling over Rs 201 crore. All proceeds were deployed toward growth objectives, specifically for onward lending and augmenting the capital base. This transparency, monitored by CRISIL Ratings, reinforces management's commitment to its stated business expansion strategy.
- Confirmed NIL deviation in the utilization of Rs 201.33 crore raised via preferential issue of warrants.
- Raised Rs 149.99 crore on Nov 24, 2025, and Rs 51.33 crore on Dec 20, 2025.
- 100% of the raised funds were utilized for 'Growth Objectives' including onward lending, exceeding the minimum 75% threshold.
- CRISIL Ratings Limited acted as the monitoring agency, verifying the fund deployment.
- Funds are being used to support commercial vehicle financing, housing finance, and SME lending portfolios.
IndoStar Capital Finance has approved its unaudited standalone and consolidated financial results for the quarter and nine months ended December 31, 2025. The company reported the successful deployment of approximately ₹201.33 crore raised through preferential issues in late 2025. Notably, 100% of these funds were utilized for growth objectives and onward lending, exceeding the minimum 75% requirement. The board confirmed there were no deviations in the utilization of proceeds, indicating disciplined execution of its capital allocation strategy.
- Approved Unaudited Consolidated and Standalone Financial Results for Q3 and 9M FY2025-26.
- Successfully utilized ₹149.99 crore raised via preferential issue on November 24, 2025, for growth objectives.
- Deployed ₹51.33 crore raised via preferential issue on December 20, 2025, for onward lending and capital augmentation.
- Achieved 100% fund utilization for core business growth, surpassing the mandated minimum threshold of 75%.
- Confirmed zero deviation or variation in the use of funds as per the monitoring agency (CRISIL Ratings).
IndoStar Capital Finance Limited has scheduled a conference call for analysts and institutional investors on Tuesday, February 10, 2026, at 12:00 PM IST. The call is intended to discuss the company's unaudited financial results for the third quarter and nine months ended December 31, 2025. Key leadership, including Managing Director Randhir Singh and CFO Jayesh Jain, will be present to address queries. This is a standard regulatory disclosure following the conclusion of the December quarter.
- Conference call scheduled for February 10, 2026, at 12:00 PM IST to discuss Q3 FY26 results.
- Management participants include MD & Executive Vice Chairman Randhir Singh and CFO Jayesh Jain.
- Universal dial-in numbers provided are +91 22 6280 1550 and +91 22 7115 8378.
- International toll-free numbers available for investors in the USA, UK, Singapore, and Hong Kong.
IndoStar Capital Finance Limited has announced the resignation of Mr. Arvind Uppal from his position as Chief Business Officer for the Vehicle Finance segment, effective February 03, 2026. Mr. Uppal is departing to pursue external growth opportunities after his tenure with the company. As the head of a core business vertical, his exit necessitates a leadership transition in the vehicle lending division. The company has formally acknowledged the resignation and will manage the transition during the notice period.
- Mr. Arvind Uppal resigned as Chief Business Officer – Vehicle Finance on February 03, 2026.
- The resignation is intended to allow the executive to pursue opportunities outside the organization.
- The company filed the formal notification with stock exchanges on February 04, 2026.
- Vehicle Finance is a significant business vertical for IndoStar, making this a key leadership change.
IndoStar Capital Finance Limited has completed the allotment of 50,000 Non-Convertible Debentures (NCDs) to raise INR 500 crore through a private placement. The issuance is structured across three series with coupon rates of 8.85%, 8.90%, and 9.10%, maturing between May 2028 and January 2029. These instruments are secured by a first pari-passu charge on the company's loan receivables and portfolio assets. This capital infusion will likely support the NBFC's growth objectives and liquidity management.
- Total allotment of 50,000 NCDs with a face value of INR 1 lakh each, amounting to INR 500 crore
- Series XXVIII (INR 200 Cr) carries an 8.85% coupon with a 28-month tenor maturing May 2028
- Series XXIX (INR 150 Cr) carries an 8.90% coupon with a 30-month tenor maturing July 2028
- Series XXX (INR 150 Cr) carries a 9.10% coupon with a 36-month tenor maturing January 2029
- NCDs are secured by a first pari-passu charge on the company's receivables and portfolio assets
IndoStar Capital Finance has announced a strategic leadership shuffle in its technology division effective January 20, 2026. Mr. Shivam Choudhary, a veteran with 19 years of experience in IT and fintech innovation, has been appointed as the new Chief Technology Officer. Simultaneously, the former CTO, Mr. Amit Kothari, has been re-designated as the Chief AI Officer. This move underscores the company's commitment to digital transformation and the integration of artificial intelligence into its financial services operations.
- Appointment of Shivam Choudhary as Chief Technology Officer effective January 20, 2026
- Shivam Choudhary brings 19 years of experience in digital transformation and multi-million-dollar IT budget management
- Re-designation of former CTO Amit Kothari to the specialized role of Chief AI Officer
- Strategic focus on fintech innovation and enterprise technology solutions to optimize operations
IndoStar Capital Finance Limited has informed the exchanges that its statutory auditor, M S K A & Associates, has converted from a partnership firm into a Limited Liability Partnership (LLP) effective January 13, 2026. The firm is now officially known as M S K A & Associates LLP with ICAI Firm Registration Number 105047W/W101187. The auditor will continue to discharge its duties for the remainder of its existing tenure. This is a standard administrative change in the auditor's legal structure and has no impact on the company's operations or financial health.
- Statutory Auditor M S K A & Associates converted to an LLP effective January 13, 2026
- The new entity is registered as M S K A & Associates LLP under the LLP Act 2008
- ICAI Firm Registration Number is updated to 105047W/W101187
- The auditor will continue to serve for the remaining period of their current appointment tenure
IndoStar Capital Finance Limited has approved the allotment of 4,344 equity shares of face value INR 10 each following the exercise of stock options by employees. The allotment consists of 2,850 shares under the 2016 ESOP Plan and 1,494 shares under the 2018 ESOP Plan. Consequently, the company's paid-up equity share capital has increased slightly to INR 161.54 crore. This is a routine administrative procedure with minimal impact on the overall shareholding structure.
- Allotment of 4,344 equity shares of INR 10 face value each.
- Includes 2,850 shares under ESOP Plan 2016 and 1,494 shares under ESOP Plan 2018.
- Paid-up equity capital increased from INR 1,61,53,21,240 to INR 1,61,53,64,680.
- Total number of equity shares outstanding increased to 16,15,36,468.
Financial Performance
Revenue Growth by Segment
Total income (net of interest) grew 36.5% YoY to INR 456 Cr in FY25 from INR 334 Cr in FY24. The company is shifting focus to retail segments, with Commercial Vehicle (CV) disbursements now comprising approximately 33.3% of total disbursements as the company diversifies into Passenger Vehicles, Construction Equipment, and Micro LAP.
Geographic Revenue Split
Not specifically disclosed in available documents, though the company operates a nationwide network including 48 upgraded micro-branches and maintains a presence in Mumbai (Registered Office).
Profitability Margins
Profitability has been subdued with a Return on Assets (RoA) of 0.5% in FY25 compared to 0.8% in FY24 and 2.2% in FY23. Net profit for Q2 FY26 was INR 10.4 Cr, representing a 42.2% decrease from INR 18 Cr in Q2 FY25. Yields on loans improved significantly to 18.1% in FY25 from 13.4% in FY23 due to the shift toward higher-yielding CV segments.
EBITDA Margin
Not explicitly provided as a percentage, but Net Interest Income is supported by a declining cost of funds which reached 10.2% in Q2 FY26 (down from 10.8% YoY). Incremental borrowing costs have further dropped to a range of 9.0% - 9.25%.
Capital Expenditure
The company maintains a strong capital base with a Capital Adequacy Ratio of 37.3% as of Q2 FY26. It recently completed the sale of its subsidiary, Niwas Housing Finance, in July 2025 to WITKOPEEND B.V. (an EQT affiliate) to reallocate capital toward core retail growth.
Credit Rating & Borrowing
The company faces debt obligations of INR 3,194 Cr (including interest) due within one year. Borrowing costs were 11.4% in FY25 but have trended down to 10.2% in Q2 FY26. The company successfully raised INR 265.59 Cr through its maiden public issue of Secured Redeemable NCDs in September 2024.
Operational Drivers
Raw Materials
As a financial services entity, the primary 'raw material' is capital/debt. Total borrowings are managed through NCDs (limit of INR 6,000 Cr approved), Commercial Papers, and bank lines.
Key Suppliers
Funding is sourced from various banks, money market investors, and through the public NCD issue which saw participation for INR 265.59 Cr.
Capacity Expansion
The company is expanding its retail reach by upgrading 48 micro-branches and increasing field sales staff to support the Micro LAP and Vehicle Finance businesses.
Raw Material Costs
Cost of funds (interest expense) is the primary operational cost, which stood at 10.2% in Q2 FY26. Management is focused on reducing this to improve lending spreads.
Manufacturing Efficiency
Operational efficiency is measured by digital adoption: 95% of Micro LAP and 27% of vehicle finance collections are processed via eNACH as of September 2025.
Logistics & Distribution
Distribution is driven by a network of branches and Direct Selling Agents (DSAs), with payouts aligned to market standards to drive disbursement momentum.
Strategic Growth
Expected Growth Rate
40-50%
Growth Strategy
The company expects H2 disbursements to be 1.4x to 1.5x of H1 disbursements. Strategy involves a total shift from corporate lending to a retail-focused model targeting Used CV and Micro LAP, supported by the sale of the housing finance subsidiary to focus management bandwidth and capital.
Products & Services
Used Commercial Vehicle (CV) loans, Micro Loan Against Property (LAP), Passenger Vehicle loans, Construction Equipment financing, and Farm Equipment loans.
Brand Portfolio
IndoStar, Indo Mitra (Customer App).
New Products/Services
Expansion into 'Prime' business segments and multi-product retail offerings using existing distribution strength.
Market Expansion
Focusing on growing the Micro LAP and Used CV book responsibly under tighter credit norms across its existing branch network.
Market Share & Ranking
Aims to be one of the top-performing retail NBFCs in India; specific market share percentage not disclosed.
Strategic Alliances
Majority owned by Brookfield Asset Management (56.20% stake) and Everstone Group (17.4%). The sale of Niwas Housing Finance was to an affiliate of BPEA EQT.
External Factors
Industry Trends
The NBFC industry is shifting toward retail and digital-first models. IndoStar is positioning itself as a multi-product retail lender to capture growth in the under-penetrated Micro LAP and used vehicle markets.
Competitive Landscape
Competes with other retail NBFCs and private banks in the CV and SME/LAP segments.
Competitive Moat
Moat is built on a strong capital base (37.3% CAR), backing from a global promoter (Brookfield), and a specialized distribution network for used CVs. Sustainability is driven by the transition to a granular retail book which reduces systemic risk.
Macro Economic Sensitivity
Highly sensitive to the macroeconomic environment and interest rate cycles, which affect both the cost of borrowing and the repayment capacity of CV operators and micro-enterprises.
Consumer Behavior
Increasing preference for digital self-service tools, evidenced by the 95% eNACH adoption in the Micro LAP segment.
Geopolitical Risks
Limited direct impact, though global fuel prices can affect the cash flows of the transport operator borrower segment.
Regulatory & Governance
Industry Regulations
Regulated by the RBI as a systemically important non-deposit taking NBFC. Must comply with GS3 (Gross Stage 3) reporting and Capital Adequacy norms (currently 37.3%).
Environmental Compliance
Direct environmental risk is low. The company has an ESG Working Committee and follows a digital-first model to minimize paper waste.
Taxation Policy Impact
Standard Indian corporate tax rates apply; specific effective tax rate for FY25 not detailed in the snippets.
Legal Contingencies
The company underwent a secretarial audit for FY25 which confirmed compliance with applicable statutory provisions. No specific pending court case values were disclosed in the provided text.
Risk Analysis
Key Uncertainties
Asset quality remains a primary risk, with GNPA at 4.52%. Failure to improve this could lead to higher credit costs, similar to the 12.4% credit cost seen in FY22.
Geographic Concentration Risk
While headquartered in Mumbai, the company is expanding its branch network to diversify geographic risk across India.
Third Party Dependencies
High dependency on banks for funding lines and on DSAs for lead generation and disbursements.
Technology Obsolescence Risk
Mitigated by active investment in the Indo Mitra app and digital collection tools; 100% score in RBI cybersecurity exercise indicates strong digital resilience.
Credit & Counterparty Risk
Exposure is diversified across retail borrowers in the CV and Micro LAP segments, reducing the impact of any single counterparty default.