AU Small Finance Bank Ltd (AUBANK) Q2 FY27 Results Analysis: PAT Jumps 53%, GNPA Hits Five-Quarter Low
AU Small Finance Bank Ltd's Q2 FY27 numbers came in strong, with revenue of Rs. 6,381.99 Cr (+22.17% YoY) and PAT growth of +52.92% YoY. Here's a quick read of what worked, what to watch, and what management said.
| Results date | October 24, 2026 |
|---|---|
| Quarter | Q2 FY 2026-2027 |
| Revenue (Q2) | Rs. 6,381.99 Cr (+22.17% YoY) |
| PAT (Q2) | Rs. 857.69 Cr (+52.92% YoY) |
| EPS (Q2) | Rs. 11.44 (+52.13% YoY) |
| Market cap | Rs. 70,132.86 Cr |
| CMP | Rs. 932.90 |
Quarter Snapshot
AU Small Finance Bank delivered NII growth of 31.5% YoY and PAT growth of 52.9% YoY, with GNPA at a five-quarter low of 1.99% and credit cost running below the ~90 bps FY27 build. Deposit growth of 28.6% YoY is roughly double the private-bank system, supporting the franchise-over-rate positioning. The main watch items are the QoQ NNPA rise to 0.81%, PCR decline to 59.66%, and the stretch to the 1.8% FY27 RoA target, which requires a ~17% H2 step-up.
Key Investment Insights
Key Positives
- NII grew 31.5% YoY to Rs.2,820.08 Cr with interest earned (+24.4%) outgrowing interest expended (+18.0%)
- PAT grew 52.9% YoY to Rs.857.69 Cr; H1 PAT Rs.1,653.64 Cr, +44.8% YoY
- GNPA improved to 1.99% from 2.10% QoQ and 2.41% YoY, best in five quarters
- Provisions fell 25.3% YoY to Rs.359.40 Cr; derived credit cost ~0.70% annualized vs ~90 bps FY27 build
- Cost-to-income at 57.84%, inside the <60% guidance threshold
- Deposits grew 28.64% YoY to Rs.1,70,460.05 Cr, roughly double private-bank system growth of 13.8%
- All lending segments grew revenue >17% YoY with retail segment margin expanding from 11.13% to 15.34% and wholesale from 22.26% to 31.96%
- Other income turned positive at +8.1% YoY and +11.8% QoQ after a −4% YoY print in Q4 FY26
Risk Factors
- NNPA rose QoQ to 0.81% from 0.76% and above 0.74% in March 2026, with net NPAs at Rs.1,205.35 Cr
- Provision coverage ratio fell to 59.66% from 64.06% in Q1 and 64.18% a year ago
- Effective tax rate rose ~265 bps YoY to 25.70%, a drag on the PAT bridge
- Other banking operations segment revenue fell 18.9% YoY and result fell 23.4% YoY; H1 other income still −4.2% YoY
- H1 RoA of ~1.66% annualized leaves the 1.8% FY27 target requiring ~1.94% annualized in H2, a ~17% step-up
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Disclaimer: This results analysis is published for educational and informational purposes only. It is not investment advice, not a recommendation to buy, sell or hold any security.