PNB Housing Finance reports strong Q2 FY26 performance, improved asset quality

PNB Housing Finance Limited reported a strong second quarter and first half for FY26, with the retail loan book growing 17% year-on-year to INR 79,439 crore as of September 30, 2025. Total retail disbursements for Q2 FY26 increased by 12% year-on-year, reaching INR 5,995 crore. The affordable and emerging market segments were key growth drivers, expanding by 34% year-on-year and contributing approximately 50% of total retail disbursements.

The company's asset quality continued to improve, with gross NPA declining to 1.04% as of September 30, 2025, from 1.06% on June 30, 2025. Credit cost saw a reversal of 53 bps during the quarter, aided by INR 59 crore recovered from the written-off pool and a release of INR 70 crore in ECL from a corporate loan foreclosure. Profitability also strengthened, with return on assets improving to 2.73% for Q2 FY26 and 2.65% for H1 FY26.

Despite a marginal decline in yield to 9.95%, the cost of borrowing decreased by 7 bps sequentially to 7.69% in Q2 FY26, driven by negotiations and repo rate cuts. Net interest income grew 14% year-on-year to INR 765 crore, and PAT increased 24% year-on-year to INR 582 crore. The company maintains its full-year loan growth guidance of 17% to 18%.