Capital Small Finance Bank LimitedQ2FY27 Results & Financial Update
Capital Small Finance Bank Limited: Q2FY27 standalone results and company financials – total income ₹330.95 Cr, PAT ₹45.61 Cr. Explore reported YoY/QoQ movements, margins, business drivers and management commentary. This page does not provide a rating, target price or investment recommendation.
Quarter at a glanceReported figures and period changes.Changes compare like-for-like reported periods where available.
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Quarterly Results AnalysisExplore Capital Small Finance Bank Q2FY27 quarterly results and earnings: revenue, profit (PAT), EBITDA, margins, YoY and QoQ growth, order book or business updates where reported, financial performance and management commentary. Reported figures and Nivata calculations are shown separately; no buy, sell or hold recommendation is provided.
Quarter overview
Quarterly earnings analysis
Capital Small Finance Bank reported a standalone profit after tax of INR 45.61 crore for the second quarter of fiscal 2027, marking a 30.7% expansion compared to INR 34.89 crore in the corresponding period of the previous year.
Total income for Q2FY27 rose to INR 330.95 crore from INR 279.60 crore in Q2FY25, supported by steady expansion across interest-earning assets and non-interest income streams.
Gross advances grew by 23.4% year-on-year and 7.5% quarter-on-quarter to reach INR 9,755 crore as of September 30, 2026, aided by robust quarterly disbursements of INR 1,095 crore.
Total deposits increased by 16.2% year-on-year to touch INR 10,831 crore, with the current account and savings account (CASA) ratio standing at 34.5% compared to 33.9% in the year-ago period.
Asset quality metrics continued to strengthen during the quarter, with gross non-performing assets improving to 2.36% and net non-performing assets easing to 1.12%, reflecting disciplined underwriting and collection efficiency.
Net interest margin expanded to 4.24% for Q2FY27, up from 4.04% in Q2FY26, while return on assets improved to 1.39% from 1.26% over the same timeframe.
Operating efficiency improved as the cost-to-income ratio moderated to 59.8% from 61.7% in the corresponding period last year, driving pre-provision operating profit up by 30.9% year-on-year to INR 67.92 crore.
01 · Business model
What does Capital Small Finance Bank do?
Capital Small Finance Bank Limited is headquartered in Jalandhar, Punjab, and operates as India's first small finance bank following its transition from Capital Local Area Bank, which was established in January 2000.
The bank serves middle-income customer segments across rural, semi-urban, and urban geographies, maintaining a branch network of 222 branches spread across five states and two Union Territories.
Its economic and operating model focuses on secured, retail-oriented lending, with approximately 97% of its gross loan book backed by collateral and an emphasis on relationship banking.
Core revenue engines are driven by net interest income from diverse asset classes—including agricultural loans, MSME business loans, mortgages, and consumer financing—complemented by retail-focused deposit mobilization.
02 · Historical context
What shaped the business before this quarter
The bank commenced operations as India's first small finance bank on April 24, 2016, following its conversion from Capital Local Area Bank.
The bank successfully completed its initial public offering and listed on BSE and NSE in February 2024, raising INR 523 crore including a fresh issue of INR 450 crore.
03 · Financial snapshot
Current quarter vs the two useful baselines
| Metric | Q2FY27 | Year-ago | Previous quarter |
|---|---|---|---|
| Total income | ₹330.95 Cr | ₹279.60 Cr | ₹314.30 Cr |
| Profit before tax | ₹61.89 Cr | ₹46.37 Cr | ₹55.00 Cr |
| Profit after tax | ₹45.61 Cr | ₹34.89 Cr | ₹41.30 Cr |
| EPS | ₹10.03 | ₹7.70 | ₹9.06 |
04 · Earnings & margin drivers
What drove earnings and margins
What drove net interest income and earnings
Net interest income grew by 24.2% year-on-year to INR 138.7 crore during Q2FY27, underpinned by a 23.4% expansion in gross advances to INR 9,755 crore.
Non-interest income rose to 0.92% of average total assets in Q2FY27 compared to 0.86% a year ago, driven by advance-related fee income of INR 12.1 crore and banca commissions of INR 10.2 crore.
Total loan disbursements for the quarter accelerated by 36.0% year-on-year to INR 1,095 crore, led by robust traction in MSME and business loans.
NIM, spread, funding cost and credit cost
Net interest margin improved to 4.24% in Q2FY27 from 4.04% in Q2FY26 and 4.21% in Q1FY27, aided by effective yield management across interest rate cycles.
Cost of deposits moderated to 5.68% in Q2FY27 from 5.92% in Q2FY26, supported by a granular retail-led liability franchise with negligible bulk deposits.
Cost-to-income ratio improved to 59.8% in Q2FY27 compared to 61.7% in Q2FY26, enabling operating margin to strengthen to 2.08% of average assets.
05 · Loan growth, sanctions & disbursements
How the lending book is moving
Total customer base reached approximately 8.13 lakh customers served across 46 districts by the end of September 2026.
The average ticket size for the gross loan book stood at INR 1.95 million as of Q2FY27, reflecting granular retail orientation.
06 · Portfolio mix & lending exposure
Where the loan book is concentrated
Segments and products
MSME, trading, and business loans grew to INR 2,765 crore, expanding 13% quarter-on-quarter and 51% year-on-year to serve as the primary growth driver.
Agricultural loans stood at INR 2,575 crore, comprising Kisan Credit Cards and agricultural term loans with an average ticket size of INR 1.34 million.
Housing loans reached INR 1,000 crore and loan against property (LAP) stood at INR 1,365 crore, maintaining the bank's core focus on secured real estate lending.
Geography and market mix
The bank operates 222 branches across Punjab, Haryana, Rajasthan, Delhi, Himachal Pradesh, Jammu & Kashmir, and Chandigarh, with 74.3% of advances concentrated in Punjab and 25.7% in other states.
The bank continues to scale up new branch openings in contiguous geographies such as Haryana, Rajasthan, and Delhi, with advances outside its home state growing by 39% year-on-year.
07 · Asset quality & capital strength
How credit quality and balance-sheet capacity changed
Asset quality, stages and credit risk
Gross NPA improved to 2.36% in Q2FY27 from 2.70% in Q2FY26 and 2.47% in Q1FY27, while Net NPA improved to 1.12% from 1.38% and 1.14% respectively.
Provision coverage ratio stood at 53.19% in Q2FY27 compared to 54.51% in Q1FY27, alongside a low credit cost of 0.18% for the quarter.
Collection efficiency remained robust at 99.5% for Q2FY27, supported by dedicated relationship banking and monitoring teams.
Capital adequacy, net worth and balance-sheet capacity
Capital adequacy ratio stood at 20.78% with Tier I capital at 18.45% as of September 30, 2026, comfortably above regulatory minimums to support future growth.
Book value per share increased to INR 334.97 as of September 30, 2026, up from INR 307.00 a year earlier.
08 · Strategy & portfolio evolution
How the lending mix and strategic agenda are changing
The bank is progressing toward its 'Vision 2029' objective of reaching a INR 16,000+ crore loan book and expanding its branch network to over 300 branches while targeting an ROA of 1.6%+ and ROE of 15.0%+.
Digital transactions accounted for 89% of total non-cash transactions in Q2FY27, supported by mobile banking platforms like Capital Mobile+ and data-driven customer engagement.
09 · Reported developments
What changed operationally
Quarterly PAT expanded by 30.7% year-on-year to INR 45.61 crore, accompanied by a 30.9% rise in pre-provision operating profit to INR 67.92 crore.
Both Gross NPA and Net NPA registered sequential and annual improvements, supported by disciplined underwriting and negligible write-offs.
10 · Funding & balance sheet
How funding, liquidity and capital support the loan book
Capital allocation & funding
Total deposits grew 16.2% year-on-year to INR 10,831 crore, forming the primary funding base with retail deposits exceeding 90% of the total mix.
Borrowings stood at INR 864 crore as of H1FY27 compared to INR 577 crore in H1FY26, maintaining a balanced liquidity coverage ratio of 216.5%.
11 · Management guidance & targets
What management is targeting from here
Management's Vision 2029 targets include growing the advance book to over INR 16,000 crore, maintaining Net NPA below 1.0% and credit cost below 0.3%, expanding the branch network to 300+ branches, and achieving an ROA of 1.6%+ and ROE of 15.0%++.
12 · Beyond the numbers
What changed beyond the numbers
Reported update
Branch Network Footprint
The bank maintained 222 branches across 5 states and 2 Union Territories as of September 30, 2026.
13 · Previous-quarter changes
What changed since the previous quarter
Gross advances grew by 7.5% quarter-on-quarter from INR 9,074 crore in Q1FY27 to INR 9,755 crore in Q2FY27.
14 · Key Q&A
The quarter, answered directly
What does Capital Small Finance Bank do?
Capital Small Finance Bank Limited is headquartered in Jalandhar, Punjab, and operates as India's first small finance bank following its transition from Capital Local Area Bank, which was established in January 2000.
What is the clearest takeaway from Q2FY27?
Capital Small Finance Bank reported a standalone profit after tax of INR 45.61 crore for the second quarter of fiscal 2027, marking a 30.7% expansion compared to INR 34.89 crore in the corresponding period of the previous year.
What drove earnings or loan-book movement?
Net interest income grew by 24.2% year-on-year to INR 138.7 crore during Q2FY27, underpinned by a 23.4% expansion in gross advances to INR 9,755 crore.
What mattered most for margins, funding or credit cost?
Net interest margin improved to 4.24% in Q2FY27 from 4.04% in Q2FY26 and 4.21% in Q1FY27, aided by effective yield management across interest rate cycles.
What changed operationally beyond the headline numbers?
Gross NPA improved to 2.36% in Q2FY27 from 2.70% in Q2FY26 and 2.47% in Q1FY27, while Net NPA improved to 1.12% from 1.38% and 1.14% respectively.
What is management guiding or targeting from here?
Management's Vision 2029 targets include growing the advance book to over INR 16,000 crore, maintaining Net NPA below 1.0% and credit cost below 0.3%, expanding the branch network to 300+ branches, and achieving an ROA of 1.6%+ and ROE of 15.0%++.
15 · Scenario calculator
Earnings sensitivity: what if growth and margins change?
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16 · Next filing checkpoints
What the next disclosure can confirm or change
- 01
Loan Book Expansion: Monitor progress toward the Vision 2029 target of achieving a INR 16,000+ crore loan book.
- 02
Asset Quality Metrics: Track GNPA and Net NPA trends to evaluate the sustainability of asset quality improvements and low credit costs.
- 03
Deposit Franchise Scaling: Observe CASA ratio stability and deposit cost trends amidst evolving interest rate environments.
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