Fusion Finance Share Price Jumps 18% in a Month as Q3FY26 Earnings Turnaround Boosts Outlook

Fusion Finance share price (NSE: FUSION) risen nearly 18% over the past month, clearly outperforming benchmark indices like the Nifty and Bank Nifty, which remained mostly flat during the same period.

Return to Profit Drives Optimism

The rally follows the company’s return to profitability in Q3FY26, ending a six-quarter loss-making streak.

Fusion reported a profit after tax of ₹14.1 crore for the December quarter. The improvement came after a management change in March 2025, when Sanjay Garyali became CEO and introduced major operational and business reforms.

Improvement in Asset Quality and Credit Costs

The company’s recovery was supported by a sharp fall in credit costs to 4.6%, compared with over 21% a year earlier, helped by better loan collections.

Growth in Disbursements and Margins

Loan disbursements increased 23% quarter-on-quarter to ₹1,590 crore, the highest level in 5 quarters.

Core operating performance also improved:

• Pre-provision operating profit rose 44% year-on-year
• Net interest margin expanded by 240 basis points to 11.3%

Auditors restored the company’s going-concern status after noting sustained improvement in profitability and asset quality.

Business Reset and Future Outlook

Under new leadership, Fusion strengthened senior management, tightened credit underwriting, added extra supervision in field operations, and improved audit and fraud monitoring systems. These steps are gradually improving portfolio quality.

Although assets under management (AUM) fell about 2% sequentially to ₹6,880 crore due to earlier repayments, management expects AUM to cross ₹10,000 crore in FY27.
The company also aims to reduce credit costs to 3.25–3.7% in FY27.

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Strong Capital and Liquidity Position

Fusion ended Q3FY26 with a capital adequacy ratio of around 39% and liquidity of about ₹1,780 crore, supported by borrowings and last year’s rights issue. 

Conclusion

Fusion Finance’s improving profitability, better asset quality, and strong capital base have renewed investor confidence, leading to a sharp rise in its share price. Continued execution of the turnaround strategy will be key to sustaining growth in the coming quarters.

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