Northern Arc's Q1 profit hits record ₹114 cr on loan growth, lower bad loans
Net interest income rose 32% to ₹394 cr, AUM expanded 26% to ₹16,855 cr, and the direct-to-customer book crossed ₹10,000 cr for the first time. Asset quality improved with gross NPAs at 1.0%.
— 4 earlier stories on Northern ARC Capital Ltd. →What's new
- Consolidated net profit rose 41% YoY to ₹114 cr, a June-quarter record.
- Direct-to-customer lending book crossed ₹10,000 cr for the first time.
- Gross bad loans narrowed to 1.0% from 1.2% in the March quarter.
Why this matters
Northern Arc continues to execute well on its retailization strategy, with the D2C book now accounting for nearly two-thirds of AUM. The improvement in asset quality and lower credit costs support margins. However, as a scheduled quarterly release, these numbers offer limited surprise.
What we're watching
- Management's commentary on external risks like geopolitics and monsoon.
- Growth trajectory of the direct-to-customer book and its impact on NIMs.
- Traction from the recent partnership with YES BANK for credit deployment.
The full read
Northern Arc Capital's June-quarter net profit hit a record ₹114 crore, up 41% from a year ago. Net interest income rose 32% to ₹394 crore, and assets under management expanded 26% to ₹16,855 crore. The direct-to-customer book crossed ₹10,000 crore for the first time, now 64% of total AUM. Gross bad loans narrowed to 1.0% from 1.2% sequentially, and annualised credit cost dipped to 2.6%. Capital adequacy stood at 22.7%. Managing director Ashish Mehrotra said the company is watchful of external risks – geopolitical and monsoon-related – but sees no immediate threat to momentum. The results are solid but, as a scheduled quarterly release, offer limited surprise. The open question is how Northern Arc deploys capital against its growing D2C franchise and whether the YES Bank partnership yields measurable distribution gains.
Questions answered
- How much did Northern Arc's AUM grow in Q1FY27?
- Assets under management expanded 26% year-on-year to ₹16,855 crore.
- What was the net profit for the June quarter?
- Net profit was ₹114 crore, the highest ever for a June quarter, up 41% YoY.
- What is the direct-to-customer book and its share?
- The D2C book crossed ₹10,000 crore for the first time, now accounting for 64% of total AUM.
- How did asset quality improve?
- Gross bad loans narrowed to 1.0% from 1.2% in the March quarter, and annualised credit cost fell to 2.6%.
- What is the capital adequacy ratio?
- Capital adequacy stood at 22.7%, well above the regulatory minimum.
- What risks did management flag?
- Managing director Ashish Mehrotra said the company is watchful of geopolitical tensions and monsoon uncertainties but is well positioned to sustain momentum.
Northern ARC Capital Ltd.
Latest quarter · Mar 2026
Leverage & growth
Story so far
All notes on NORTHARC →- 27 Jul 2026 · 4:50 PM IST Northern Arc's Q1 profit hits record ₹114 cr on loan growth, lower bad loans
- today Northern Arc profit hits record ₹114 cr, but ROA target softens
- today Northern Arc's Q1 profit hits record ₹121.8 cr; AUM up 26%
- today Northern Arc's Q1 profit jumps 41% to ₹114 cr; D2C lending tops ₹10,000 cr
- 42d ago Northern ARC links up with YES BANK in non-binding partnership