Transcript of the Earnings Conference Call for the quarter ended March 31,2026
FIVESTAR · price
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Five-Star Business Finance reported strong recovery in Q4FY26 with collection efficiency at 98.1% (best in company history) and slippage ratio dropping sharply from 1.9% to 0.7%. NPA remained stable at 3.37% while credit cost was 1.88% of average AUM. The company achieved Q4 PAT of INR 269 crores and full-year PAT of INR 1,099 crores (up 2% YoY despite challenges). Disbursements surged 24% sequentially to INR 1,213 crores, with full-year disbursements at INR 4,675 crores driving 11% portfolio growth. Management raised FY27 AUM growth guidance to 20% and guided credit cost of 1.7-1.75% for FY27, with steady-state credit cost of 1.5-1.6% expected over the next 2-3 years. The company also raised $100 million from Asian Development Bank and separated business and collection teams effective April 1, 2026.
The sharp improvement in collection metrics and asset quality signals Five-Star has successfully navigated the MFI overlap crisis. Management's confidence in achieving 20% AUM growth in FY27 while targeting lower credit costs suggests an improving profitability outlook for shareholders.