KOCHI: LuLu Financial Services Pvt Ltd (LFSPL) has turned profitable for the first time since its inception in 2018, posting a net profit of Rs1.81 crore in FY26, as the non-banking finance company (NBFC) gears up for its next phase of growth backed by a planned Rs125 crore promoter capital infusion over FY27 and FY28.
The company had reported a loss of Rs2.02 crore in FY25 and Rs3.09 crore in FY24. India Ratings and Research expects LFSPL to further improve its profitability during FY27.
Operating expenses increased to Rs12.8 crore in FY26, mainly due to the strategic expansion of its branch network. However, the cost-to-income ratio improved to 85.31 per cent from the previous year, while credit costs remained low at 0.3 per cent.
According to India Ratings, the promoters are expected to infuse Rs25 crore during FY27 and another Rs100 crore in FY28 to support the company's expansion plans and maintain a comfortable capital position.
LFSPL's operations are overseen by a six-member board comprising one managing director, one independent director and four directors. During FY26, Adeeb Ahamed, one of the promoters of LuLu Financial Holdings, joined the board.
According to the rating agency, the company benefits from its association with the Abu Dhabi-headquartered LuLu Group, whose businesses span retail, commercial real estate and hospitality across three continents. The group's long-standing presence in Kerala is expected to support the company's liability mobilisation and strengthen its brand visibility.
AUM continues to grow
LFSPL's assets under management (AUM) increased to Rs203.3 crore in FY26, reflecting the steady expansion of its lending operations. The company had 66 branches at the end of FY26 and plans to expand its network to 100 branches by March 2027 and 150 by the end of FY28.
According to the rating report, LFSPL plans to open 34 new branches during FY27, including 19 in Tamil Nadu and 15 in Karnataka. It also intends to enter the Telangana and Andhra Pradesh markets in FY28 as part of its geographical expansion strategy.
India Ratings said continued portfolio diversification, franchise strengthening and sustainable growth would remain key monitorable factors for the company.
As of March 2026, LFSPL's borrowings increased to Rs15.4 crore, reflecting its expanding scale of operations. The borrowing mix comprised term loans from banks and non-banking finance companies (41.4 per cent), overdraft and cash credit facilities (28 per cent), non-convertible debentures (25.3 per cent) and subordinated debt (5.3 per cent).
