Dhanlaxmi Bank [NSE: DHANBANK] has shown a strong recovery in Q1 FY26, recording a net profit of ₹12 crore, marking a significant improvement in its profitability. The strong performance reflects the bank’s ability to manage challenges and deliver consistent growth across its key business segments.
On 21 July 2025, Dhanlaxmi Bank announced its Q1 results, showcasing a remarkable improvement in profitability, total income, and growth across various revenue streams, despite facing higher provisions and contingencies.
Key Financial Highlights for Q1 FY26
For Q1 FY26, Dhanlaxmi Bank posted a net profit of ₹12.18 crore, compared to a net loss of ₹8 crore in Q1 FY25, demonstrating a clear recovery. The total income surged by 20.45% YoY, reaching ₹407.06 crore for the quarter ending 30 June 2025.
Despite higher provisions and contingencies of ₹21 crore (compared to ₹4.7 crore in the previous year), the bank’s overall performance was solid, reflecting resilience in its operations.
Segmental Revenue Performance
- Treasury revenue reported ₹76.38 crore, reflecting a 27.28% growth compared to the same period last year.
- Retail banking revenue stood at ₹218.58 crore, growing by 17.04% compared to the same period last year.
- Corporate and wholesale banking revenue grew by 22.29% YoY, reaching ₹109.28 crore.
- Other banking operations saw the highest growth of 55.8% YoY, reaching ₹2.82 crore.
These solid segmental performances underscore Dhanlaxmi Bank’s diverse operations, with all key business areas contributing positively to the overall results.
Asset Quality and Provisioning
On the asset quality front, gross non-performing assets (GNPA) rose to 3.22% as of 30 June 2025, compared to 2.98% in Q4 FY25 but a clear improvement from 4.04% in Q1 FY25. Similarly, net NPAs stood at ₹138.62 crore, an increase from ₹117.94 crore in Q4 FY25 and ₹130.61 crore in Q1 FY25.
Despite these slight increases in NPAs, the provision coverage ratio (PCR) improved to 87.31%, showcasing the bank’s strong approach to managing impaired assets effectively.
Capital Adequacy and Future Outlook
The capital adequacy ratio (CAR) under Basel III for Q1 FY26 stood at 18.26%, an improvement from 16.12% in Q4 FY25 and 13.37% in Q1 FY25, reflecting the bank’s strengthened capital position, which will support future growth and stability.
Dhanlaxmi Bank continues to focus on improving its asset quality and capitalisation, with plans to strengthen its balance sheet and enhance its digital offerings in the future. The bank remains focused on sustainable growth and managing liquidity efficiently.
Stock Performance and Market Sentiment
On 21 July 2025, Dhanlaxmi Bank’s shares rose by 3.49%, closing at ₹30.25, as investor confidence grew following the favourable quarterly results. This uptick in stock price highlights the market’s confidence in the bank’s recovery and future prospects.
Conclusion
Dhanlaxmi Bank’s Q1 FY26 results showcase a strong turnaround, with a net profit of ₹12 crore and significant growth across its key business segments. Despite challenges in asset quality, the bank has shown strong resilience and maintained operational effectiveness.
Dhanlaxmi Bank remains committed to improving its asset quality, strengthening its capital base, and managing liquidity effectively, positioning itself for continued growth in the upcoming quarters in the Indian stock market.
