Are India Home Loans Ltd latest results good or bad?

India Home Loans Ltd's latest financial results for Q2 FY26 present a mixed picture of performance. The company reported a net profit of ₹0.07 crores, reflecting a significant sequential increase from ₹0.01 crores in the previous quarter. However, this figure remains low in absolute terms, especially when considering the company's shareholder funds of ₹41.44 crores. Interest income for the quarter was ₹3.50 crores, which represents an 18.22% decline from ₹4.28 crores in Q1 FY26. This contraction raises concerns regarding the company's ability to generate new loans and maintain its existing portfolio in a competitive market. While there was a modest year-on-year growth of 6.71% compared to ₹3.28 crores in Q2 FY25, it is still below the growth rates observed in the broader sector. The operating margin showed a notable expansion to 56.86%, up from 46.26% in the previous quarter, but this increase was primarily driven by the revenue decline rather than operational efficiency improvements. The return on equity (ROE) remains low at 0.48%, indicating ongoing challenges in capital efficiency and profitability. The company has experienced fluctuations in its financial metrics over recent quarters, with interest income oscillating between ₹2.33 crores and ₹4.28 crores, suggesting a lack of consistent growth. Additionally, the balance sheet shows a high leverage level, with current liabilities at ₹59.75 crores, which, while reduced from the previous year, still raises concerns about the sustainability of the business model. Overall, the financial results indicate that India Home Loans Ltd is facing significant operational challenges, particularly in generating meaningful revenue and maintaining profitability, despite some positive indicators in net profit and operating margins. The company saw an adjustment in its evaluation, reflecting these underlying issues.