Capri Global Capital Ltd. issues fresh guidance

Car Loan contributes 0% to reported AUM. It is an off-book, fee-based distribution business, not a funded lending portfolio; therefore, its originations should not be added to CGCL’s on-book AUM or treated as an AUM product share. ^[1] The Q1 FY27 AUM mix is fully allocated to Gold, Housing, MSME and Construction Finance, with “Others” at 0.0%. ^[2]

The key distinction is between AUM mix and income mix. Car Loan generates fee income—Q1 FY27 gross fee income was Rs 76.3 Crores and net fee income was Rs 32.1 Crores—but this is non-interest income rather than lending spread. ^[5] Consequently, the strategic expansion of Car Loan distribution can improve fee income and diversify earnings without mechanically increasing or reducing the blended NIM.

For reference, reported NIM increased from 8.8% in FY26 to 9.6% in Q1 FY27, a derived improvement of 0.8 percentage points. ^[4] The presentation does not attribute this movement to Car Loan; analytically, it should instead be assessed through the on-book product mix, loan yields, funding costs and operating leverage. MSME’s 17.6% yield and Housing’s 13.6% yield are gross segment yields, not directly comparable with the company-wide NIM after funding costs.

Q1 FY27 current metrics: Cost of Funds was 8.90%. The presentation’s opex-to-AUM measure was 4.50%, defined as cost excluding fee and commission cost divided by average AUM, adjusted for car-loan origination commission expense. ^{[4] [6]}

Reconciliation with operating leverage

• Operating leverage is already visible: the adjusted cost-to-AUM ratio declined from 4.90% in FY26 to 4.50% in Q1 FY27, while the cost-to-income ratio improved from 50% to 45%. ^[6]
• Funding economics also improved: Cost of Funds eased from 9.00% in FY26 to 8.90%, while yield on average interest-earning assets increased from 16.10% to 17.50%. This implies a gross yield-cost spread of 8.60 pp in Q1 FY27 versus 7.10 pp in FY26, a derived improvement of 1.50 pp. ^[4]
• The stated operating-leverage strategy is to use the existing branch network, improve productivity through technology and AI, and scale new markets, customer segments and partnerships. ^[7] The company also identifies diversified borrowings and greater co-lending as tools to improve liability management and reduce funding costs. ^[8]

Analyst read: The figures are consistent with the company’s operating-leverage thesis: incremental scale is currently translating into lower operating cost intensity, while funding costs remain controlled and yields are rising. This suggests the new verticals are not yet causing a material dilution in consolidated efficiency. However, the comparison is directional rather than strictly like-for-like because FY26 is a full-year period whereas Q1 FY27 is a single quarter; sustained leverage will depend on whether the 4.50% cost-to-AUM level holds as branch, technology and new-vertical investments continue.

Q1 FY27 asset quality was materially better in Housing than in MSME, but a quantified comparison with mid-sized-NBFC industry averages is not possible because no numeric industry benchmark is reported.

• Industry comparison: CGCL’s presentation does not provide the reported GNPA/NNPA averages for mid-sized NBFCs, so it is not possible to state reliably whether MSME or Housing was above or below that benchmark. Management does, however, describe CGCL’s overall GNPA as being among the industry’s top quartile; this is a company-level positioning claim, not a segment-specific industry average ^[11].
• Provisioning: Segment PCR stood at 45.6% for MSME and 19.0% for Housing in Q1 FY27 ^[10]. The company’s overall Stage 3 PCR was 43.3% in the quarter ^[10].
• Implication: MSME carries the higher reported delinquency burden and correspondingly stronger coverage. Housing has much lower GNPA/NNPA, while its lower PCR likely reflects the portfolio’s secured nature and lower reported loss severity; the latter is an analyst inference rather than a separately stated management explanation.

_Scope note: this comparison also included IIFL Finance Ltd. (IIFL); Manappuram Finance Ltd. (MANAPPURAM); Five-Star Business Finance Ltd. (FIVESTAR); SBFC Finance Ltd. (SBFC); Poonawalla Fincorp Ltd. (POONAWALLA), which the answer above does not cover. Ask about any of them for a full side-by-side._