Why are Shriram Finance shares falling despite a 41% jump in Q4 profit?

Shriram Finance share price fell more than 4 per cent in early trade on Monday after the company announced its March quarter (Q4FY26) results after market hours on Friday.

The stock opened at Rs 1,011.30 and slipped to an intraday low of Rs 963.75, down over 4 per cent. The stock touched a high of Rs 1,012 during the session. Shriram Finance’s market capitalisation stood at Rs 2.30 lakh crore. Its 52-week high is Rs 1,108, while the 52-week low is Rs 566.50.

Q4 profit rises 41 per cent

Shriram Finance reported a 41 per cent year-on-year rise in consolidated net profit for the January-March quarter at Rs 3,013 crore, compared to Rs 2,139 crore in the same period last year, according to its exchange filing.

The NBFC’s total revenue from core operations rose 9.2 per cent to Rs 12,509 crore in Q4FY26, against Rs 11,454 crore a year ago.

Interest income for the March quarter increased 12 per cent to Rs 12,087 crore from Rs 10,789 crore in the corresponding quarter last year.

Earnings per share (EPS) also improved to Rs 16.02 per share, compared to Rs 11.38 per share in the same quarter of the previous financial year.

Shriram Finance dividend announced

The board of directors recommended a final dividend of Rs 6 per share of face value Rs 2 each for FY26, subject to shareholder approval at the company’s 47th Annual General Meeting (AGM).

“The board recommended a final dividend of Rs 6 per share of face value of Rs 2 each fully paid up (i.e. 300 per cent) for the financial year ended March 31, 2026 subject to approval of Members at the ensuing 47th Annual General Meeting,” the company said in its stock exchange filing.

Eligible shareholders will receive Rs 6 per share for every share held, based on the record date to be announced by the company.

What brokerages said

Jefferies maintained its ‘Buy’ rating on Shriram Finance with a target price of Rs 1,210, slightly lower than its earlier target of Rs 1,220. It said profit beat estimates due to lower operating expenses, while AUM growth and NIM were slightly below estimates.

The brokerage expects 17 per cent EPS CAGR and return on equity of 13–14 per cent over FY27-28 and said valuations remain reasonable.

UBS maintained a ‘Buy’ call and raised the target price to Rs 1,220 from Rs 1,200.

HSBC also maintained a ‘Buy’ rating and raised its target to Rs 1,200 from Rs 1,050. It said the Q4 earnings beat was driven by strong operating cost control, which led to sharp expansion in return on assets.

The brokerage added that the uncertain macro environment and weaker monsoon remain key monitorables for growth and asset quality.

Citi maintained its ‘Buy’ rating and increased the target price to Rs 1,180 from Rs 1,160. It said growth remains steady, but persistent headwinds could pose risks to the company’s 18–20 per cent growth target.

Macquarie maintained an ‘Outperform’ rating with a target price of Rs 1,220. It said operating cost control helped beat profit estimates, while focus now shifts to FY27 growth and credit costs remain a key monitorable.