Financial Services Q4 Results Preview: DRChoksey Expects Stress To Bottom Out; HDFC AMC Among Top Picks

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DRChoksey Report

Despite intensifying competition from banks, NBFCs continue to gain share in high-yield segments like MSME lending, gold loans, and unsecured retail finance, where speed, flexibility, and customized offerings give them an edge.

On the asset quality front, credit costs remain elevated in sub-segments such as vehicle finance and microfinance, but we expect normalization from FY26E, supported by improving borrower behavior, better data-driven underwriting, and a more cautious lending approach.

We remain constructive on high-quality NBFCs with diversified asset profiles, scalable operating models, and prudent risk management. These players are expected to outperform as credit cycles normalize and digital operating leverage begins to reflect meaningfully in margins and return ratios.

Top Picks: HDFC AMC and Poonawalla Fincorp stand out for their strong brand equity and robust market positioning.

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