PNB Housing Finance has posted its strongest quarter yet on the origination front. The Punjab National Bank-promoted housing finance company disbursed ₹9,609 crore in the July–September quarter of FY27 (Q2 FY27), up 60% from ₹5,995 crore a year earlier, while retail disbursements touched an all-time high of ₹9,250 crore, according to results approved by its board on 28 October 2026.
Consolidated net profit rose 6% year-on-year to ₹617 crore, against ₹582 crore in Q2 FY26, and climbed 11% over the previous quarter’s ₹557 crore. Net interest income (NII) grew 15% to ₹878 crore from ₹765 crore.
Loan book grows 19%, mix shifts to higher-yield segments
Loan assets expanded 19% year-on-year to ₹95,079 crore as of 30 September 2026, with the retail book at ₹94,391 crore. Assets under management stood at ₹98,210 crore, up 17%. Retail disbursements grew 54% year-on-year and 59% sequentially, and corporate disbursements came in at ₹360 crore.
The growth is being steered towards the Affordable and Emerging Markets segments, which grew 45% and 22% respectively and together now make up 41% of the retail loan book. According to the company’s investor presentation, affordable disbursements rose 40% to ₹1,149 crore and Emerging Markets disbursements rose 36% to ₹2,882 crore, while the lender has also started a micro housing finance product. The branch network stood at 404 branches at the end of September.
Margins and asset quality improve sequentially
Net interest margin (NIM) expanded 17 basis points quarter-on-quarter to 3.67%, flat year-on-year. Spread improved 31 bps sequentially to 2.43%, yield on loans rose 26 bps to 9.74% and the cost of borrowing eased 5 bps to 7.31%. The company’s presentation notes that the quarter included a one-off gain linked to the prepayment of a corporate account; excluding it, NIM would have been 3.49%.
Gross non-performing assets (GNPA) improved to 0.91% from 0.95% in the June quarter and 1.04% a year ago, while net NPA eased to 0.55%. Recoveries of ₹75 crore from the written-off pool resulted in a credit cost of minus 19 bps. Return on assets came in at 2.53% and return on equity at 12.33%. Capital adequacy remained strong at 27.03%, with Tier I capital at 26.62%.
The quarter also saw CRISIL upgrade the lender to AAA, giving it the top rating from all four major domestic agencies, which management expects to help on borrowing costs.
What the management said
“Our focus on granular retail expansion, particularly in the Affordable and Emerging Markets segments, has enabled us to strengthen our market position while maintaining prudent risk discipline,” said Ajai Kumar Shukla, Managing Director & CEO, PNB Housing Finance. He added that the company recorded its highest-ever retail disbursements while asset quality continued to improve on the back of strong collections and recoveries.
Looking ahead to the second half of FY27, Shukla said the company remains confident about the long-term housing finance opportunity and will keep expanding its retail footprint and improving customer experience.
Why it matters
The numbers show a large housing finance company shifting decisively from prime towards affordable and emerging-market borrowers to defend margins, at a time when the RBI has turned to calibrated tightening. With the AAA sweep lowering funding costs and asset quality at multi-year bests, the key watchpoints for the rest of FY27 will be how sustainable the disbursement pace is and whether operating costs from branch expansion stay in check.
