Gold-led growth & operating leverage drives valuation…
About the stock: Capri Global Capital Ltd (CAPGLO) is a well-diversified NBFC with presence in Gold, MSME, Housing loans and Construction finance.
• Diversified AUM mix – ~42% Gold, ~19% MSME, ~21% Home, ~17% Construction finance & others
• Immersed in high potential products as micro-LAP, rooftop solar, car loan origination, insurance distribution, etc
Investment Rationale:
Diversification across product + geography to sustain business momentum: Capri Global continues its retail-led growth playbook anchored around gold, housing, micro-LAP/MSME and co-lending, with distribution expansion and new geography entry (South India) driving incremental volumes. Management has maintained medium-term AUM target of ₹50,000-55,000 crore by FY28 and guided for ₹33,000–34,000 crore AUM in FY26 and ₹43,000–44,000 crore in FY27, indicating visibility of sustained growth momentum beyond near-term. During Q3FY26, the company added 68 gold branches and entered new high-potential geographies (Odisha, Andhra Pradesh, Telangana, Karnataka). Housing also expanded in Andhra Pradesh/Karnataka, while MSME started operations in Mumbai/Pune/Delhi to improve portfolio diversification.
Levers available to sustain RoA: The earnings profile is increasingly supported by (a) higher-yield segments (Gold + Micro LAP), (b) rising fee pools (insurance + co-lending + distribution), and (c) operating leverage as branches mature. In Q3FY26, AUM rose to ₹30,406 crore (47% YoY / 12% QoQ) and disbursements at ₹10,879 crore (+87% YoY), supported by non-interest income which rose to ₹240 crore (+124% YoY) and formed ~32% of total income, aided by co-lending fee income (₹116 crore vs ₹29 crore in Q3FY25) and scaling insurance distribution (Capri Care digital ecosystem rollout). Cost-to-income improved to 51.6% (vs 58.2% in Q3FY25). PAT stood at ₹255 crore (99% YoY).
Stable asset quality trajectory amid rapid growth: Asset quality remains a key strength for Capri Global, supported by its predominantly secured portfolio, disciplined underwriting and analytics-led collection framework. In Q3FY26, impairment cost declined to ₹23 crore (~0.4% of gross loan book) while provision coverage on Stage 3 improved to 43.6% (39.4% in Q3FY25). Segmentally, Stage 3 ratios improved across gold, housing and construction finance portfolios and remained largely stable in MSME, while Stage 2 assets stood at ~4% of gross loans, suggesting contained early stress levels. Additionally, a potential credit rating upgrade, post recent equity infusion (₹2000 crore QIP) could drive funding cost efficiency aiding RoA.
Rating and Target Price
• We believe Capri Global is well-positioned to compound earnings over the medium term on (i) sustained AUM growth visibility with FY28 AUM target of ₹50-55k crore, (ii) mix-led margin support from gold + Micro LAP, (iii) fee income scale-up (insurance + co-lending), and (iv) operating leverage with improving cost-to-income ratio. Factoring in FY28E, we assign a BUY rating on the stock, with target price of ₹220, valuing the stock at 2.1x FY28E BV.
