Cholamandalam Investment Q2 net profit rises 41% on strong income growth, plans Rs 5000 crore capital raise

Cholamandalam Investment Q2 profit rose 41%.

The board on Wednesday approved a proposal to raise up to Rs 5,000 crore through a qualified institutional placement. The capital would be raised over the next six to nine months, the management said on an analyst call.

Assets under management rose 25% year on year to Rs 2.68 lakh crore, while aggregate disbursements increased 47% to Rs 35,872 crore during the quarter.

Net income increased 24% to Rs 5,037 crore from Rs 4,075 crore a year earlier. Loan losses declined 3% to Rs 874 crore, supporting profitability even as total expenses rose 22% to Rs 1,975 crore. Profit before tax increased 40% to Rs 2,188 crore. Total income rose 23% to Rs 9,367 crore, while finance costs increased at the same pace to Rs 4,329 crore.

Net interest margin remained flat at 7.9% in the second quarter. Speaking to analysts after the results, the management said it expects the cost of funds to rise by 10-15 basis points year on year in the coming quarter. Nearly half of Cholamandalam’s borrowings are at floating rates, while the remainder is linked to banks’ marginal cost of funds-based lending rates. Total borrowings stood at Rs 2.31 lakh crore at the end of September 2026.

The vehicle-finance book grew 21% to Rs 1.30 lakh crore, while disbursements stood at Rs 17,801 crore. The loan-against-property portfolio grew 24% to Rs 57,447 crore, while disbursements stood at Rs 6,438 crore.

The SME-loan book grew 45% to Rs 10,943 crore, while disbursements stood at Rs 2,453 crore. The gold-loan business, launched in 2026, accounted for 5% of total disbursements. Its assets under management stood at Rs 3,446 crore, while disbursements were Rs 1,960 crore. The company operated the business through 308 branches.