CHOLAFIN
Large CapCholamandalam Investment and Finance Company Limited
Financial Services
Cholamandalam Investment and Finance Company Limited (CHOLAFIN) is an Indian NBFC offering a diversified portfolio including vehicle finance, home loans, LAP, SME, SBPL, consumer durables, and a newly launched gold loan business. The company focuses on broad-based growth and improving asset quality across its segments.
One read, four checks
75+ is strong, 60-74 is usable, 45-59 is mixed, and below 45 needs caution. These are research lenses, not buy/sell instructions.
Weak fundamentals, management trust is acceptable, price trend argues for patience, and recent execution is consistent.
Fundamental lens: valuation, quality, growth, balance sheet, and cash flow.
medium confidence · 4/10 claims checked
Timing lens: price trend and sector relative strength.
Rolling lens: recent quarterly delivery, not the latest single-result score.
Quarter ended 31 Mar 2026
Excellent · 75/100Rev +19% YoY · PAT +31% YoY · +7% QoQ · operating leverage
| Metric | This quarter | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹8,417 Cr | +19.5% | +6.6% |
| EBITDA | NDF | NDF | NDF |
| Operating margin | NDF | NDF | NDF |
| PAT | ₹1,645 Cr | +30.6% | +27.5% |
| PAT margin | 19.5% | +166 bps | +321 bps |
NDF means not disclosed in the current structured filing feed. It is intentionally not treated as zero.
Where growth can come from, and what can break the case
CHOLAFIN reports strong Q4 FY26 with 25% YoY disbursement growth and 21% YoY AUM growth. NIMs improved 40 bps YoY, and RoA (pre-overlay) reached 4.1%. Management expects continued growth and declining credit costs in FY27.
Management's Q4 FY26 results show robust growth across segments, improving asset quality trends, and stable profitability. The precautionary management overlay for global uncertainties is noted. FY27 guidance for AUM growth (20-23%) and declining credit costs (1.5%) appears achievable, supported by diversified business engines and ongoing underwriting improvements.
MSME Segment
MSME segment AUM grew 29% year-on-year, with LAP at 26%, SME at 41%, and SBPL at 46% growth YoY, supported by strong demand and branch-led distribution.
Consumer Segment
Consumer segment delivered 45% year-on-year disbursement growth, driven by sustained momentum across product segments.
Gold Loan Business
Newly launched Gold Loan business disbursed INR 1,130 crores in Q4 FY26, with average ticket size declining to ~INR 2 lakh, reflecting granular acquisition.
Vehicle Finance
Vehicle Finance business reported 26% year-on-year growth in Q4, driven by sustained demand across vehicle categories, with AUM increasing 18% YoY.
Gold Loan Branches
Planning to add 360 more exclusive Gold Loan branches to the current 119.
Home Loan Branches
Planning to open approximately 100 new Home Loan branches in FY27, leveraging existing Vehicle Finance infrastructure.
LAP Branches
Planning to add 100 new LAP branches, co-located within Vehicle Finance network.
CSEL and CD Branches
CSEL and Consumer Durables segments are also likely to add 100 branches.
Softening Interest Rates
Gradual reduction in the Company's cost of funds as interest rates softened during the period, contributing to NIM improvement.
Strong Demand Across Segments
Sustained demand across vehicle categories, MSME, and consumer segments, with April 2026 showing strong performance in CV and PV segments.
Improved Collection Efficiency
Better capacity utilization of vehicles and resolutions through the SARFAESI process led to improved overall collection efficiency.
Diversified Business Portfolio
All eight business engines are now contributing to growth, providing higher comfort and diversification against market uncertainties.
Global Uncertainties
Heightened global uncertainties led to a management overlay of INR 200 crores as a precautionary buffer against potential second-order stresses.
Procedural Timing Factors
Home loan disbursements saw mild moderation in Q4 due to election-related administrative slowdowns, land-record digitization mismatches, and localized lien-marking delays.
Impact of Global Uncertainties
Management overlay addresses potential stresses from volatility in crude/fuel prices, LPG supply shortfalls, and supply-side pressures on global shipping/commodity flows.
Capital Adequacy for Growth
If Tier 1 ratio approaches 13%, the company would evaluate equity-raising options, though internal accruals are expected to be sufficient for 20-23% growth.
What management said, and what results must prove
Issuer guidance and extracted claims are tracked against later reported outcomes. Treat these as management statements, not IndiaPulse forecasts.
YoY comparisons are crucial for assessing AUM and disbursement growth, reflecting long-term trends. QoQ comparisons are relevant for tracking sequential momentum in asset quality indicators like Stage 2/3 assets and early defaults, as well as the ramp-up of newer businesses like Gold Loans.
AUM Growth
AUM increased to INR 2,42,630 crores, reflecting healthy 21% year-on-year growth as at the end of Q4 FY26.
Disbursements Growth
Aggregate disbursements of INR 32,913 crores, representing a 25% year-on-year growth for Q4 FY26.
Net Interest Margin (NIM)
NIMs improved by 40 bps year-on-year in Q4 FY26, driven by a gradual reduction in the Company's cost of funds. Expected to remain stable at ~8% in FY27.
Credit Costs (before overlay)
Credit costs declined by 20 bps year-on-year in Q4 FY26 across product segments. Net credit cost expected to decline from 1.6% (pre-overlay) to ~1.5% in FY27.
FY27 AUM Growth Guidance
Company continues to maintain its committed growth trajectory of 20% to 23% for FY27.
FY27 Net Credit Cost Outlook
Expects net credit cost to decline from 1.6% (pre-overlay) to around 1.5% in FY27, driven by underwriting tool improvements.
FY27 Pre-tax ROA Target
Consequently, return on assets should improve, moving closer to a pre-tax ROA of 3.5% in FY27.
Operating Leverage Timeline
Believes it will take another year or so before seeing meaningful operating leverage due to new branch additions and IT investments.
Numbers and claims to verify in the next filings
| Checkpoint | Current evidence | What to verify next |
|---|---|---|
| Overall AUM Growth | 21% YoY (Q4 FY26) | Sustained growth in the 20% to 23% range for FY27, indicating continued market penetration and demand. |
| Net Credit Cost | 1.6% (pre-overlay) | Decline to ~1.5% in FY27, validating the effectiveness of improved underwriting tools and asset quality management. |
| Pre-tax Return on Assets (ROA) | 3.3% (post-overlay) | Improvement to ~3.5% in FY27, reflecting enhanced profitability from stable NIMs and lower credit costs. |
| Tier 1 Capital Ratio | 14.73% (March '26) | Monitoring if the ratio approaches 13%, which would trigger evaluation of equity-raising options to support growth. |
Verification checkpoints are IndiaPulse research interpretation, not investment advice.
Show extracted source claims
The remaining INR 1,700 crores of CCDs are expected to be converted into equity over the next three quarters, strengthening the company's net worth.
"expected to be converted in the next three quarters"
Management expects the current quarter to be a turnaround quarter for overall disbursements, driven by pick up in vehicle finance and home loans.
"overall disbursement side, this quarter will be turnaround quarter"
Outcome check: Revenue YoY averaged 19.5% across 1 later quarter(s).
Delinquencies are expected to go down during the third and fourth quarters, in line with historical seasonal trends.
"delinquency goes down this quarter. So, we are in line with that"
Management expects Q3 performance to be a decent quarter, potentially better than the first half of the fiscal year.
"better than the results of the first half"
Outcome check: Revenue YoY averaged 19.5% across 1 later quarter(s).
Trend score and candlestick chart
42NeutralSMA20 -6.9% / mo
Technical chart
CHOLAFINweekly · 1Y-3.8%Technical trend read
Mixed signalsSignals are conflicting — long-term trend unclear. RSI 46. Wait for confirmation.
- SMA20 falling (~7.4% over last month) — short-term momentum negative.
- RSI(14) at 46 — rising, no extreme reading.
- MACD below signal but histogram contracting — bearish momentum easing.
- 18% off 52W high · 15% above 52W low.
Mechanical read from the price + indicator series above. Not a recommendation — technical setups can reverse without warning, especially around earnings and macro events.
Valuation, score drivers, trust methodology, financials, and peers
Use these sections after reviewing the decision summary, latest result, thesis, management accountability, and technical timing above.
Fundamental score breakdown
WATCHLISTWhy this score?
Top U-Score contributors and drags from the latest stored fundamentals.
Positive drivers
- Fair-value margin of safety is positive at 26.0%.
- Growth contributes 18/25 to the score.
- Quality contributes 9/20 to the score.
Main drags
- Altman Z is 0.6, in distress territory.
- Balance sheet is weaker at 0/15; verify the latest quarterly trend.
- Cash flow is weaker at 0/10; verify the latest quarterly trend.
NBFC valuation: P/B, ROA, borrowing cost, and asset quality
Lenders can look optically cheap before credit losses emerge, so valuation is tied to book quality.
Stored run vs live recompute
This shows the stored score trend when snapshots exist, and also compares the latest stored nightly score with a live recompute from current fundamentals and price.
Score history
12 stored score snapshots. Latest stored move: +1 points.
Factor attribution
Trust asks: does management behaviour match later outcomes? Higher is better, but confidence and evidence depth matter as much as the number.
Mixed Trust: Management has 75% delivered/partly-delivered outcomes on 4 checked claims, with 1 adverse claim outcome. It ranks around the 27th percentile of the scored universe and 42nd percentile within Financial Services. Main check: balance sheet trust is weak at 22/100.
Healthy Trust: 4/10 extracted management claims have outcome checks; 75% were fully delivered and 0 were partially delivered. 1 claim(s) were contradicted or failed. Key concern: Operating cash flow is negative at ₹-30021 Cr.
Usable, but needs evidence. Treat guidance with a margin of safety.
overall median 67 · Financial Services: 42nd pctile, median 62 · Large: 16th pctile, median 74
4/10 claims checked. Use as directional, not final.
4/10 claims checked · 1 contradicted/failed claim
How to read this Trust Score
Mixed Trust · medium confidenceRead Trust alongside U-Score, result consistency, and technical trend. A cheap stock with weak Trust needs a larger margin of safety; a high Trust score does not make an expensive stock attractive by itself.
Forensic breakdown
Read low sub-scores as due-diligence warnings, not automatic sell signals.
Trust positives
- ▸Promoter pledge is zero.
- ▸4/4 latest quarters had positive YoY revenue growth.
- ▸4/4 latest quarters had positive YoY PAT growth.
- ▸Latest 3 quarters had positive YoY PAT growth.
Trust risks
- ▸Operating cash flow is negative at ₹-30021 Cr.
- ▸Debt/equity is 6.93.
- ▸Altman Z is 0.56.
- ▸Only 0 years of positive FCF.
Intrinsic value
Fundamentals
Valuation
- P/E
- 23.70
- P/B
- 4.08
- EV/EBITDA
- 1180.23
- Market Cap
- 124115.00Cr
Profitability
- ROE
- 19.30%
- ROCE
- 9.70%
- ROA
- 2.13%
- Dividend Y
- 0.14%
Growth (CAGR)
- Revenue 5Y
- 27.00%
- EPS 5Y
- 28.00%
- Revenue 3Y
- 34.00%
- EPS 3Y
- 25.00%
Balance Sheet
- Debt/Equity
- 6.93
- Interest Coverage
- —
- Altman Z
- 0.56
- Book Value
- 357.00
Cash Flow
- FCF Yield
- —
- FCF Positive Y
- 0/5
- OCF
- -30021.00 Cr
- EPS TTM
- 61.41
Shareholding
- Promoter Hold
- 49.25%
- Promoter Pledge
- 0.00%
- Momentum 52W
- 29%
Financial History
Updated 9/6/2026
Revenue
₹ CrNet Profit
₹ CrReturn on Equity
%Peers
Business-comparable peers in Financial Services — ranked by industry, sub-sector, theme-tag overlap, market cap, and U-Score similarity. Green cells mark the best available peer metric in this table.