While prior research has explored the intersection of national religious cultures and business practices, the direct impact of family-level religious identity on organizational performance remains insufficiently examined. This study addresses this critical gap by analysing how the religious affiliation of controlling families influences firm performance in a non-Western, multireligious context. Leveraging the unique setting of India—a nation characterized by religious pluralism, with Hinduism as the dominant faith alongside significant minority communities such as Jainism, Zoroastrianism (Parsi), Christianity, and Islam—we investigate the role of family owners’ religious identities in shaping organizational outcomes. We argue that religious logics fundamentally shape the cognitive frameworks, risk orientations, and strategic priorities of family owners, which in turn influence firm performance. Our findings demonstrate that Hindu-owned firms exhibit lower profitability, driven by a pronounced tendency for liquidity hoarding and risk aversion. These effects are further reinforced in family-managed firms, where religious and familial imperatives are embedded within strategic decision-making processes. This study contributes to institutional theory by highlighting religious identity as a form of informal institution that exerts differential impacts on organizational performance. Additionally, it enriches family business research by positioning religion as a critical source of performance heterogeneity, offering nuanced insights into the interplay between religious identity, economic behaviour, and firm outcomes in a multireligious organizational environment.