Fusion Finance Ltd (FUSION)
🎯 Key Takeaways
- Fusion Finance Ltd is transitioning from a distressed, loss-making entity to a stabilized financial services player with improving profitability and asset quality. Management is focused on scaling operations prudently, leveraging technology for efficiency, and expanding its AUM base.
- Revenue grew 8.1% QoQ to ₹458 in Q1FY27.
- ⚠️ Concentration in disbursement growth: While YoY growth is strong, sustaining 80%+ disbursement growth may be challenging without overexposure to high-
📖 The Story
Fusion Finance Ltd is transitioning from a distressed, loss-making entity to a stabilized financial services player with improving profitability and asset quality. Management is focused on scaling operations prudently, leveraging technology for efficiency, and expanding its AUM base. The company has moved past its worst quarter (Q3 FY26) and is now executing a turnaround narrative anchored in sustainable growth and balance sheet resilience.
📰 What's Happening
In Q1 FY27, Fusion reported a 67% QoQ rise in PBT to INR 62 crore, driven by 88% YoY disbursement growth and improved asset quality with Gross NPA at 2.51%. AUM expanded to INR 7,702 crore (4% QoQ), NIM reached 11.93%, and CRAR stood at 36.95%, reflecting stronger capital adequacy. Management highlighted technology-led efficiency and prudent portfolio expansion as key levers for future growth. The company also scheduled analyst meetings in September 2026 to enhance investor engagement, following a prior delay in regulatory filings. Additionally, it paid INR 1.2555 crore in interest on NCDs and granted 10,000 ESOP options, signaling ongoing capital efficiency and employee incentive alignment.
Source: Stock Announcements
📊 Quarterly Results (₹ Cr)
| Metric | Sep 2025 | Dec 2025 | Mar 2026 | Jun 2026 |
|---|---|---|---|---|
| Revenue | 401 | 416 | 424 | 458 |
| Operating Profit | -54 | 6 | 31 | 62 |
| OPM % | -13.5% | 1.5% | 7.4% | 13.6% |
| Net Profit | -22 | 14 | 114 | 62 |
| EPS | ₹-1.69 | ₹1.05 | ₹7.06 | ₹3.86 |
The financial trajectory shows a clear inflection point: from a loss of INR 22 crore in Q3 FY26 to a profit of INR 62 crore in Q1 FY27, with operating margins expanding from -13.5% to 13.6%. This turnaround is underpinned by robust disbursement growth (88% YoY) and improved asset quality. Revenue growth has stabilized, with quarter-on-quarter increases from INR 401 crore to INR 458 crore, while profitability metrics are trending upward. The company is now generating meaningful operating cash flows (INR 1,146 crore in Q1 FY27), indicating operational stabilization and reduced reliance on external financing.
🔮 Management Outlook & What's Next
Management has signaled a strategic focus on technology-led efficiency, prudent portfolio expansion, and responsible scaling as the path forward. There is no formal long-term guidance provided, but the tone in the Q1 FY27 earnings call transcript was confident, emphasizing sustainable and disciplined growth. The company is prioritizing asset quality and capital adequacy (CRAR of 36.95%) over aggressive expansion, suggesting a maturing growth strategy. The shift from crisis management to operational optimization is evident in the improved cost structure and margin performance.
Extracted from official company announcements. Not StockFin.ai's opinion.
🏦 Balance Sheet (₹ Cr)
| Item | Mar 2025 | Mar 2025 | Mar 2026 | Mar 2026 |
|---|---|---|---|---|
| Equity Capital | 101 | 101 | 131 | 162 |
| Reserves | 2,422 | 1,543 | 1,787 | 2,294 |
| Borrowings | 8,641 | 6,402 | 4,934 | 5,571 |
| Total Liabilities | 11,481 | 8,293 | 7,090 | 8,295 |
| Fixed Assets | 27 | 25 | 28 | 45 |
| Investments | 2 | 2 | 2 | 2 |
| Total Assets | 11,481 | 8,293 | 7,090 | 8,295 |
The balance sheet reflects a deliberate shift toward capital efficiency and asset quality improvement. Equity has grown steadily from INR 101 crore to INR 162 crore (March 2025 to March 2026), while reserves have more than doubled, indicating retained earnings and stronger capital buffers. Borrowings have declined from INR 6,402 crore to INR 5,571 crore over the same period, suggesting active deleveraging. Total assets have stabilized around INR 8,295 crore, with growth now driven by organic expansion in AUM rather than balance sheet expansion. This points to a conservative and sustainable capital allocation strategy focused on reducing financial risk.
💰 Cash Flow Statement (₹ Cr)
| Item | Mar 2026 |
|---|---|
| Operating | +1,146 |
| Investing | +12 |
| Financing | -67 |
| Net Cash Flow | +1,092 |
👥 Shareholding Pattern
| Category | Q2FY26 | Q3FY26 | Q4FY26 | Q1FY27 |
|---|---|---|---|---|
| Promoters | 55.0% | 54.9% | 54.5% | 54.0% |
| FII | 3.9% | 4.9% | 4.7% | 4.8% |
| DII | 11.9% | 11.9% | 14.4% | 15.3% |
| Public | 19.9% | 18.9% | 17.9% | 17.9% |
| # Shareholders | 76,683 | 73,667 | 70,009 | 68,121 |
Institutional investor interest is gradually increasing, with FII holdings rising from 3.93% in Q2 FY26 to 4.77% in Q1 FY27, and DII from 11.88% to 15.25% over the same period. Public shareholding has also improved slightly, while promoter holding has declined from 54.95% to 53.96%, partly due to the reclassification of Devesh Sachdev and family from promoter status. The growing number of shareholders (68,121 in Q1 FY27) and stable institutional participation suggest improving market confidence. There are no signs of large-scale exits, and the trend reflects broader market interest in the NBFC sector.
⚖️ Peer Comparison — Finance
| Company | MCap (₹ Cr) | P/E | ROCE | ROE | D/E |
|---|---|---|---|---|---|
| BAJFINANCE | 6.63 L Cr | 32.6 | 10.4% | 18.1% | 3.82 |
| BAJAJFINSV | 3.20 L Cr | 31.4 | 11.4% | 26.5% | 5.50 |
| SHRIRAMFIN | 2.57 L Cr | 19.3 | 11.5% | 17.1% | 3.80 |
| TATACAP | 1.60 L Cr | 29.1 | 8.4% | 12.3% | 5.28 |
| CHOLAFIN | 1.59 L Cr | 27.6 | 9.3% | 18.9% | 6.93 |
| JIOFIN | 1.58 L Cr | 74.2 | 2.3% | 1.6% | 0.17 |
| ICICIAMC | 1.52 L Cr | 30.4 | 111.5% | 83.6% | 0.00 |
| BAJAJHLDNG | 1.27 L Cr | 14.3 | 12.4% | 12.3% | 0.00 |
| MUTHOOTFIN | 1.24 L Cr | 10.9 | 14.4% | 29.3% | 3.88 |
| SBIFUNDS | 1.18 L Cr | — | — | — | 0.00 |
🔗 Peer Stock Analyses
⚠️ Risk Factors
1. Concentration in disbursement growth: While YoY growth is strong, sustaining 80%+ disbursement growth may be challenging without overexposure to high-risk segments. 2. Gross NPA at 2.51% remains elevated compared to peers, indicating potential vulnerability to macroeconomic shocks. 3. Rising employee cost from ESOPs could pressure profitability if not offset by revenue growth. 4. Regulatory scrutiny on NBFCs could impact pricing or expansion plans. The company’s turnaround is promising but still fragile, with asset quality and funding costs being key monitoring points.
📋 Recent Filings
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🔴 Announcement 31 August 2026Fusion Finance Ltd announced on August 31, 2026, its schedule for upcoming analyst and institutional investor meetings in September, including a one-t...
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🔴 Corporate Action 29 August 2026Fusion Finance Ltd paid interest on its non-convertible debentures on August 28, 2026, for the due date of August 29, 2026, amounting to INR 1.2555 cr...
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🔴 Financial Results 17 August 2026Fusion Finance Limited announced the transcript of its Q1 FY26-27 earnings conference call held on August 10, 2026, now available on its website via a...
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Announcement 15 August 2026Fusion Finance Limited disclosed a ₹2.70 lakh RBI penalty for KYC compliance lapses, specifically failing to implement a six-monthly customer risk rev...
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Announcement 13 August 2026Fusion Finance Limited clarified that a recent Economic Times article about cutting microfin share and offering larger retail loans was based on pre-a...
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Announcement 12 August 2026No summary available
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🟡 voting results 11 August 2026Fusion Finance Limited announced that shareholders approved the reclassification of Mr. Devesh Sachdev and his family from the Promoter & Promoter Gro...
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🟡 Board Meeting 10 August 2026Fusion Finance Limited announced on August 10, 2026 that its Board's Nomination and Remuneration Committee approved the grant of 10,000 stock options ...
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🔴 Financial Results 10 August 2026Fusion Finance Limited reported a 67% QoQ rise in Profit Before Tax to INR 62 crore for Q1 FY27, driven by 88% YoY disbursement growth and improved as...
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🟡 Board Meeting 10 August 2026Fusion Finance Limited announced the outcome of its board meeting held on August 10, 2026, approving unaudited financial results for the quarter ended...
🧠 Analyst's Read
Fusion Finance is in the early stages of a credible turnaround, supported by improving profitability, asset quality, and capital ratios. The next few quarters will be critical to assess whether the current growth trajectory is sustainable and scalable. Investors should monitor disbursement quality, NIM trends, and any guidance on long-term growth targets. The reduction in promoter influence and rising institutional interest add positive governance and market confidence signals, but execution risks remain.
Based on filing content and financial data. Not a recommendation.
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Data sourced from stock announcements. Analysis generated by StockFin.ai.
For informational purposes only — not investment advice. Updated 2026-09-01.
Editorial & Data Transparency Notice
This analysis was programmatically compiled using StockFin AI utilizing official regulatory disclosures from the BSE and NSE. Content is automatically synthesized and audited against public financial filings. StockFin.ai is an educational research platform and is NOT a SEBI-registered investment advisor or research analyst.
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