UGRO Capital Limited has received approval from the Reserve Bank of India to acquire all shares of Profectus Capital Private Limited, paving the way for a landmark sector consolidation. The acquisition, valued at ₹1,400 crore and set to close by October 31, 2025, marks a significant milestone for UGRO, promising a leap in scale and operational strength. Upon completion, Profectus becomes a UGRO subsidiary, and a merger application will immediately follow, targeting full integration with effect from April 1, 2025.
This all-cash transaction will deliver instant scale for UGRO Capital with a projected 29% spike in Assets Under Management (AUM) and an enhanced secured asset mix. The diversified portfolio expansion includes a major entry into high-yield Emerging Markets and Embedded Finance segments and unlocks incremental opportunities worth over ₹2,000 crore in school financing. Additional strengths gained cover Secured Loan Against Property (LAP), Machinery Finance, and Supply Chain Finance, aligning both companies’ lending platforms for deeper market reach. Through these strategically complementary portfolios, UGRO expects to generate cost savings of ₹115 crore and add approximately ₹150 crore in profitability, lifting return on assets by 0.6–0.7% once the integration concludes.
Commenting on the development, Mr. Shachindra Nath, Founder and Managing Director, UGRO Capital, said, “The RBI’s approval is a critical milestone that validates our strategy and accelerates our mission of solving India’s small business credit gap. Profectus’ complementary portfolio, combined with UGRO’s DataTech underwriting capabilities, will enable stronger profitability, higher secured lending, and inclusive growth across the MSME ecosystem.”
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Profectus Capital contributes a network spanning seven states and three decades of secured credit leadership, amplifying UGRO’s data-driven, customer-centric model. Leaders from both firms highlight the unique synergies and operational efficiencies expected from the merger, which are set to drive inclusive growth and unlock new product opportunities for MSMEs across emerging markets in India.
