UGRO Capital, India’s largest co-lender in the MSME segment, has announced its financial results for the quarter that ended June 30, 2024. The company reported an impressive Assets Under Management (AUM) of INR 9,218 Cr, marking a substantial 36 per cent YoY increase. Profit After Tax (PAT) for the quarter stood at INR 30 Cr, reflecting a 20 per cent rise from the same period last year.
UGRO Capital’s robust performance is underpinned by significant equity capital raised amounting to INR 1,265 Cr via CCDs and warrants. The net disbursement for the quarter, adjusted for Supply Chain Finance (SCF), was INR 1,330 Cr, compared to INR 1,268 Cr in the corresponding quarter of the previous year. Total Income for Q1 FY25 stood at INR 301.6 Cr, a 38 per cent increase YoY, while Net Total Income reached INR 165.4 Cr, up by 32 per cent.
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The company’s asset quality remains strong, with Gross Non-Performing Assets (GNPA) and Net Non-Performing Assets (NNPA) at 2.0 per cent and 1.2 per cent of total AUM, respectively. UGRO Capital’s distinctive co-lending model and strategic partnerships have resulted in 45 per cent of its AUM being off-book. This collaborative approach has facilitated data-driven bespoke finance solutions to around 1 lakh MSMEs across India, in partnership with over 15 co-lending partners, 56 lenders, 45 fintechs, and 650+ GRO partners.
Shachindra Nath, Founder and Managing Director of UGRO Capital, expressed his enthusiasm about the company’s achievements, stating, “At UGRO Capital, we have set ambitious goals for FY25, and we are poised to innovate and expand our footprint in MSME lending. Our recent rating upgrade underscores our relentless dedication to supporting the growth aspirations of MSMEs and reflects the strength of our business fundamentals. Since inception, we have been and continue to be dedicated to facilitating their success because we truly believe that ‘MSME Accha Hai’. As the company marches forward on its path of sustainable growth, it offers a compelling opportunity for investors seeking long-term value and returns.”
The company’s strategic decision to pivot towards higher-yielding retailer financing while running down lower-yielding Supply Chain Finance AUM has contributed significantly to its robust financial performance. Additional performance highlights for the quarter include a 2 per cent quarter-on-quarter increase in AUM and a 20 per cent YoY increase in Profit Before Tax (PBT), which stood at INR 42.8 Cr. The company also reported having 164 branches as of June 2024 and noted a ratings upgrade to IND A+/Stable for long-term and IND A1+ for short-term by India Ratings and Research. Capital adequacy was at 27.9 per cent as of June 2024, bolstered by the recent equity fund raise.
UGRO Capital’s strategic investments in distribution channels, an expansive lender base, and a data-centric underwriting model have been pivotal in achieving these results. The company remains dedicated to creating the largest small business financing institution driven by data and technology, reinforcing its position as a leader in the MSME lending space.
