D Arul Selvan, President and Chief Financial Officer, CIFCL
Even as CIFCL reported 20 percent revenue and profit growth for the quarter ended September 2025 (Q2FY26), the subsequent deterioration in asset quality was noticeable.
CIFCL attributed this to a seasonal slowdown in auto financing in the second quarter when monsoons tended to disrupt the earning potential of small trucking companies. “In the second quarter there is always a little bit more pressure on credit costs,” Selvan said in an interaction with business line. But this will be corrected in the second half of the year as the festive season and macro conditions help increase transport movements, he added.
Secondly, the NBFC’s decision to phase out the consumer and small business loan (CSEL) segment by exiting financial partnerships has also contributed to the higher NPAs, he added. CIFCL recently took the decision to phase out the part of its CSEL business developed through fintech partnerships.
Gross NPAs at CIFCL stood at 4.57 per cent in September 2025, up from 4.29 per cent in June, while net NPAs stood at 3.07 per cent in September, up from 2.86 per cent in June 25.
The GST cut has had two-fold benefits, Selvan notes. While it has helped in increased investment in vehicles, it has also helped boost rural consumption, leading to increased transportation movements and revenue for vehicle owners, he noted.
The Murugappa Group NBFC is into auto finance, home loans, mortgage loans, SME loans and more recently gold loans.
With 21 percent year-on-year growth in assets under management (AUM) from September 2025, the CFO says first-half performance is in line with expectations. The second half is expected to be even better, helping the company achieve its AUM growth target of 20-23 percent in FY26.
CIFCL’s net profit for H1FY26 stood at ₹2,291 crore, up 20 per cent over the same half last year.
Published on November 7, 2025
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