Avanse Financial Services reported a 31% YoY jump in Q1 FY27 net profit to ₹154.3 Cr, while its operating revenue grew 18.4% YoY to ₹760 Cr from ₹641.6 Cr earlier
The strong earnings indicate resilient demand for education financing despite global immigration policy uncertainties that have delayed the NBFC's planned ₹3,500 Cr IPO
Avanse's total expenses rose 15% YoY in Q1 FY27, led by higher finance costs and employee expenses, while interest income remained its primary revenue driver
Education-focused NBFC Avanse Financial Services
has reported a 31% YoY uptick in its net profit for the first quarter of the ongoing fiscal year (Q1 FY27) to ₹154.3 Cr from ₹118 Cr in the year-ago period.
Sequentially, its net profit dipped by 8% from ₹168.1 Cr in the previous quarter.
The lender’s operating revenue grew 18% to ₹760 Cr from ₹641.6 Cr reported in Q1 FY26. However, its operating revenue remained flat on a QoQ basis, dipping by ₹6 Cr from last quarter.
As is the case with NBFCs, Avanse’s top line is also driven by the interest it earns from the loans it has given out. This interest stood at ₹683.5 Cr in Q1 FY27, up 18% YoY and 0.4% QoQ. It also earned ₹39.3 Cr through fees and commissions.
At the end of FY26, Avanse reported assets under management worth ₹23,411 Cr, up 1.23X from the previous year. It disbursed loans worth ₹7,019 Cr during the year.
Founded in 2013 by Amit Gainda, Avanse offers education loans to students who want to study abroad or in India. It also facilitates education institutions such as schools with access to capital for infrastructure building. It claims to have served 73,390 students till date, and most of its business comprises study abroad aspirants.
Notably, the lender had filed its DRHP for an IPO with SEBI in June 2024 and subsequently received the regulator’s nod in October 2024 for the same. It was looking to raise ₹3,500 Cr via its public listing, comprising a fresh issue of shares worth ₹1,000 Cr and an offer for sale (OFS) component of shares worth up to ₹2,500 Cr.
However, its listing plans have since been placed on hold. The company noted in its annual report for FY26 that this was due to “the evolving geopolitical situation, primarily the changes in the immigration policies in US and other countries.”
Consequently, Avanse is awaiting conducive market conditions and would re-file its DRHP with the SEBI, post obtaining requisite approvals, when the conditions would become favourable.
During FY26, study-abroad loans continued to be its biggest growth drive with an AUM of ₹18,293 Cr and disbursements of ₹4,334 Cr. Meanwhile, loans to educational institutions recorded an AUM of ₹4,102 Cr and disbursements of ₹2,086 Cr. Lastly, domestic education loans contributed an AUM of ₹432 Cr and disbursements of ₹433 Cr.
The NBFC’s total expenditure during the quarter jumped almost 15% to ₹555.5 Cr from ₹484.8 Cr reported in the year-ago period. Sequentially, Avanse’s total expenses rose 2.5% from ₹541.7 in Q4 FY26.
Finance Cost: The expenses under this head stood at ₹413.3 Cr during the period under review, an increase of 16% from ₹356.1 Cr in Q1 FY26. Finance cost includes interest on borrowings, lease liabilities and debt securities.
Employee Benefits: Expenses under this section grew 15% to ₹56.2 Cr in Q1 FY26 from ₹43.7 Cr in the year-ago period. These include salary cost, contribution to provident fund and gratuity.
Impairment Loss: The company’s impairment loss went up by 10% to ₹295 Cr in the period from ₹268.9 Cr in Q1 FY25. An impairment loss is a loss when the carrying value of a company’s asset, such as property, plant, or intangible assets like goodwill, permanently falls below its recoverable amount or fair value.
Source: Inc42 - Startups
