TMB Q2 FY27 Results Analysis: PAT Jumps 42%, GNPA Falls to 0.61%

TMB reported Q2 FY27 numbers with revenue of Rs. 2,052.40 Cr (+26.56% YoY) and PAT growth of +42.09% YoY. Here's a quick read of what worked, what to watch, and what management said.

Quarter Snapshot

TMB delivered a four-way simultaneous improvement: PAT +42.09% YoY to Rs.451.14 Cr (eighth straight sequential rise), cost-to-income at 38.28% vs the 46-47% guide, GNPA at 0.61% vs the <1% target, and ROA at 2.18% vs the >2% target, while advances (+29.70%) and deposits (+25.49%) ran well ahead of FY27 guidance. The only guided miss is CASA growth (16.26% vs 17-18%), and treasury result fell 57% YoY, though both are manageable. Management's under-promise/over-deliver track record is confirmed on every scoreable metric in the filing.

Key Investment Insights

Key Positives

• PAT grew 42.09% YoY to Rs.451.14 Cr, the eighth consecutive sequential quarterly increase
• Operating profit grew 41.80% YoY to Rs.641.55 Cr, second straight quarter above Rs.600 Cr vs the Rs.500 Cr/quarter defended benchmark
• Cost-to-income improved 553 bps YoY to 38.28%, beating the 46-47% FY27 guidance
• Advances grew 29.70% YoY and deposits 25.49% YoY, both ahead of FY27 guidance of 21-22% and 18% respectively
• GNPA fell to 0.61% (from 1.01% YoY) and NNPA to 0.14%, with PCR at 77.49% vs 74.36% a year ago
• ROA of 2.18% (up 33 bps YoY) and H1-annualized ROE of 16.53% met/exceeded FY27 targets of >2% and 15%
• CRAR of 32.39% with CET1 of 31.36%, up YoY from 30.96%/29.40%
• FEMA/SAFEMA penalty cut ~80% by Appellate Tribunal (July 9, 2026); Rs.15.45 Cr provision reversed in Q2

Risk Factors

• Treasury segment result fell 57.07% YoY and 59.22% QoQ to Rs.26.20 Cr despite revenue growth of 14.78% YoY
• CASA growth of 16.26% YoY (provisional) missed the 17-18% Q2 FY27 guidance
• Credit-deposit ratio at 86.89% is elevated, with borrowings raised to Rs.2,229.30 Cr from Rs.700.00 Cr at Mar-26
• Reported PAT includes Rs.11.46 Cr post-tax one-time benefit from the FEMA reversal; provisions rose 67.02% YoY to Rs.33.42 Cr
• Rs.1,037 Cr FEMA bonus-share show-cause notice remains unaddressed in this filing