Aditya Birla Capital (ABCL) Financial Report

Company Overview

Aditya Birla Capital (ABCL) is entering a structurally stronger earnings phase, driven by synchronized momentum across its lending, asset management, and insurance franchises. The company has demonstrated robust operating execution through FY26YTD, with broad-based improvement in growth, asset quality, and profitability across its core businesses.

Business Update

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The recent phase of portfolio recalibration within the non-banking finance company (NBFC) business is now largely behind the company. As a result, the group has resumed calibrated growth in higher-yield segments while maintaining risk discipline. The contribution of the property and casualty (P&C) book is expected to continue rising, acting as a key lever for margin expansion as the portfolio mix normalizes and yields improve.

Outlook

With the housing finance subsidiary well capitalized following the recent equity infusion from Advent International, and with steady expansion in asset management company (AMC) and insurance profitability, ABCL is well positioned for sustained earnings compounding over the next two years. We expect:

• 26% consolidated profit after tax (PAT) compound annual growth rate (CAGR) over FY26-28
• 16% return on equity (RoE) expansion by FY28

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Recommendation

We reiterate a BUY rating for Aditya Birla Capital with a March 2028 estimated price target of INR415 based on a sum of the parts (SoTP) valuation.