PNB Housing Q1FY26 net profit rises 23% YoY to ₹534 cr; affordable housing portfolio surges 143%

However, on a sequential basis, profit was down 3%.

The company’s bottom line was supported by strong momentum in its affordable and emerging markets segments, improved spreads, and further reduction in bad loans.

Retail loan assets grew 18% YoY to ₹76,923 crore as of June 30, 2025, with the affordable housing segment alone witnessing a steep 143% jump to ₹5,744 crore.

Loans in emerging markets rose 20% YoY to ₹22,701 crore, while the prime segment grew at a slower pace of 10% YoY.

These segments now contribute significantly to the overall loan book, with affordable and emerging markets together forming 37% of the retail portfolio.

Retail disbursements for the quarter rose 14% YoY to ₹4,980 crore, with half of that coming from the affordable and emerging categories.

Net interest income (NII) grew 17% YoY to ₹760 crore, while net interest margin (NIM) stood at 3.74%, slightly lower than 3.75% in the previous quarter but higher than 3.65% a year ago.

The company maintained tight control over borrowing costs, which came down to 7.76% from 7.92% in the year-ago period. Spreads improved to 2.23%, up from 2.11% in Q1FY25.

Pre-provision operating profit rose 17% YoY to ₹632 crore, though it slipped 2% sequentially.

Asset quality showed further improvement. Gross non-performing assets (GNPA) declined to 1.06% from 1.35% a year ago, and net NPA stood at 0.69%.

The retail GNPA was at 1.07%, and the corporate loan book, which has been trimmed by over 56% YoY to ₹809 crore, remained free of bad loans.

PNB Housing’s loan assets stood at ₹77,732 crore, up 16% YoY, while assets under management (AUM) rose 13% to ₹82,100 crore.

Capital adequacy remained robust with CRAR at 29.68%, of which Tier I capital was 28.96%.

The company said it reclassified 20 branches from the prime segment to emerging markets in April 2025, ensuring alignment with its strategic focus on high-yield areas.

Its total distribution network stood at 356 branches at the end of June.

Commenting on the performance, Managing Director and CEO Girish Kousgi said the company’s emphasis on high-yielding business segments helped achieve 30% YoY growth in disbursements in affordable and emerging markets. "Our asset quality continues to improve… we are confident of our ability to achieve our stated guidance for the fiscal year,” he added.