Auxilo's Revenue Rose 28% In FY26 While Its Profit Barely Moved

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Auxilo, a Mumbai-based non-banking financial company specialising in education loans, grew revenue from operations 28 per cent in FY26, while its profit was almost unchanged.

Revenue from operations rose to ₹676 crore in the year to March 2026 from ₹528 crore, according to its consolidated financial statements filed with the Registrar of Companies. Profit after tax edged up to ₹117 crore from ₹112 crore.

Interest income, the main revenue source, rose 28 per cent to ₹610 crore from ₹477.5 crore. Fees and commission income fell 13 per cent to ₹32.4 crore. Net gains from fair value changes of ₹21.3 crore and ₹14 crore of non-operating income took total income to ₹690 crore, against ₹544 crore a year earlier.

Costs grew faster. Finance costs, the largest expense, rose 36 per cent to ₹384.7 crore from ₹282.2 crore. Employee benefit expenses increased 47 per cent to ₹82.5 crore. Total expenditure rose 35 per cent to ₹533 crore from ₹394 crore, with IT, advertising, business sourcing and legal and professional costs also contributing.

Cash and bank balances fell to ₹412 crore at the end of FY26 from ₹544 crore.

Founded in 2017 and registered with the Reserve Bank of India, Auxilo lends to students pursuing higher education in India and abroad, covering tuition fees, pre-visa expenses, travel and related costs. It also offers loans to schools, colleges and institutions. The company has raised debt from lenders including Neo Group, which provided ₹225 crore in November 2025, and counts LeapFrog Investments among its backers.

Overseas education loans made up 96.16 per cent of its portfolio as of June 2024, according to a credit rating report, with 91.49 per cent of those loans under principal moratorium at the time.

The two growth rates that matter most in a lender's accounts moved in the wrong direction relative to each other.

Interest income, what Auxilo earns on its loans, rose 28 per cent. Finance costs, what it pays to borrow the money it lends, rose 36 per cent. When the cost of funds grows faster than the yield on the book, the spread between them narrows. Net interest income, the difference, came to about ₹225 crore against roughly ₹195 crore a year earlier, growth of around 15 per cent rather than 28.

That is the core of why revenue grew strongly and profit did not. The headline figure measures how large the book has become. The spread measures how much the business keeps on it.

A narrowing spread has two usual explanations for a non-bank lender. Either borrowing costs rose, or the company grew faster than it could raise cheaper funding and paid up to finance growth. For an education lender whose loans run for around ten years and are largely funded by bank term loans, the second is common.

Employee costs rose 47 per cent on top of that, and total expenditure 35 per cent. The business is building capacity ahead of revenue, which would typically be read as preparation for further growth.

That is manageable while the book keeps expanding. It becomes a problem if loan growth slows while the cost base stays where it is.

The more important feature of an education lender's book is one its annual accounts barely show yet.

Study-abroad loans typically carry a principal moratorium for the length of the course, often around two years, before repayment begins. As of June 2024, a rating report found that overseas loans made up more than 96 per cent of Auxilo's portfolio, and more than 91 per cent of those were still in moratorium.

That changes how the profit figure should be read. A lender growing quickly into moratorium-heavy loans is earning interest from borrowers who have not yet been asked to repay principal. Whether those loans perform depends on events that happen after graduation: whether students finish, find work, and earn enough to repay what they borrowed. None of that is visible in a year when much of the book is still in its grace period.

It also means repayment depends partly on factors outside the lender's control. Graduates' ability to work after study turns on immigration and visa policy in destination countries, which can shift quickly. The company has spoken this year about placing more weight on domestic education, which would reduce that exposure, though domestic loans are typically smaller.

The falling fee income points in a similar direction. Processing and commission fees are earned when loans are originated. A 13 per cent drop, against interest income up 28 per cent, suggests growth this year came more from the existing book compounding than from new disbursement momentum.

None of this makes Auxilo a weak lender. It makes it a young one in a category where credit quality shows up late. The years that will test the book are the ones when the 2024 and 2025 cohorts start repaying.

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