Earlier in April 2024, the Company raised Rs. 382 Cr of fresh equity capital from marquee investors, including IFC.

The company announced its Q1FY25 results, showcasing a solid performance across key business metrics, demonstrating resilience and a strong growth momentum.

Performance Review for Q1FY25

• Pre-provision operating profit (PPoP) grew by 43% YoY to Rs. 175 Cr in Q1FY25
• Profit after tax grew by 43% YoY to Rs. 93 Cr in Q1FY25
• Lending Assets Under Management (AUM) grew by 32% YoY to Rs. 11,869 Cr
• Gross NPA ratio was 0.47% on June 30, 2024, compared to 0.49% on June 30, 2023
• Return on Assets was 3.1% for Q1FY25 compared to 2.8% for Q1FY24
• Return on Equity was 14.7% for Q1FY25 compared to 13.3% for Q1FY24
• Total capital adequacy ratio was 21.5% on June 30, 2024.

Summary of Northern Arc’s Performance – Q1FY25:

Ø  Assets

• Lending AUM grew by 32% YoY to Rs. 11,869 Cr on June 30, 2024
• Fund AUM was Rs. 2,770 Cr on June 30, 2024
• Gross Transaction Volume grew by 38% YoY to Rs. 7,616 Cr for Q1FY25

o   Of which, Disbursements grew by 79% YoY to Rs. 4,433 Cr

• Share of Direct to Customer loans has increased to 52% on June 30, 2024, compared to 45% on June 30, 2023 

Ø  Financials

• Net Interest Income grew by 40% YoY to Rs. 272 Cr in Q1FY25
• Fee & Other income grew by 36% YoY to Rs. 25 Cr in Q1FY25
• PPoP grew by 43% YoY to Rs. 175 Cr in Q1FY25
• Credit cost was Rs. 51 Cr for Q1FY25 compared to Rs. 32 Cr for Q1FY24
• Profit after tax grew by 43% YoY to Rs. 93 Cr in Q1FY25
• Return on Assets was 3.1% for Q1FY25 compared to 2.8% for Q1FY24
• Return on Equity was 14.7% for Q1FY25 compared to 13.3% for Q1FY24 

Ø  Asset quality

• Gross NPA ratio was 0.47% on June 30, 2024, compared to 0.49% on June 30, 2023
• Net NPA ratio was 0.12% on June 30, 2024, compared to 0.17% on June 30, 2023
• Provisioning coverage ratio on Stage III assets was 74% on June 30, 2024

 Ø  Capital Adequacy

• Capital adequacy ratio was 21.5% on June 30, 2024.

Commenting on the IPO success and Q1FY25 results, Northern Arc’s MD & CEO Ashish Mehrotra said “We are pleased to report strong results for the first quarter, underpinning our commitment to improving access to retail credit by leveraging our deep domain expertise, risk management, and data-led proprietary technology stacks. Our diversified business model allows us to adapt to changing market conditions while maintaining operational excellence, thus laying the foundation for future growth. We remain focused on enabling a seamless flow of credit to the end customer in a calibrated manner and the process of delivering value to all stakeholders. Further, we are humbled by the overwhelming response to our IPO, which is a testament to our commitment towards providing credit access to underserved households and businesses across the country.“

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• Achieved revenue of INR 6,765 million in Q1FY25 with growth of 11.4% vs Q1FY24
• Robust EBITDA growth of 14.5% in Q1FY25 vs Q1FY24
• Became a zero-debt company        (in INR Mn)

Notes:

1. Based on average exchange rate of ₹83.4 per USD for quarter ended June 30, 2024, ₹83.0 per USD for quarter ended March 31, 2024, and ₹82.2 per USD for quarter ended June 30, 2023, respectively.
2. Based on INR revenue. YoY growth for quarter June 30, 2023, based on unaudited financials.
3. Earnings before interest, taxes, depreciation and amortization (“EBITDA”) represents profit/(loss) for the period before income tax expense, finance costs, depreciation and amortization expense, interest income and any exceptional items.

“In Q1FY25, we achieved revenue growth of 11.4% and robust EBITDA growth of 14.5% vs Q1FY24. We continue to see momentum and growth with our largest client and a few of our Top 20 clients with increased activity and volume levels tracking the larger pipeline of impending new product launches”, said Manish Gupta, Chairman and CEO, Indegene Limited. “Based on our conversations with our top clients, we anticipate similar momentum across the industry. Further, compared to last year, our pipeline is heathier and the quality of conversations with clients is much better, which gives us confidence about driving robust growth in the medium term.”

“Our Q1FY25 EBITDA margin of 19.6% and PAT margin of 13.0% is an improvement of 50 bps and 170 bps vs Q1FY24. Indegene is now a zero-debt company with repayment of loans, and we anticipate the financial leverage to drive stronger PAT growth going forward”, said Suhas Prabhu, CFO, Indegene Limited. “Also, we continue to strengthen our technology and automation initiatives, which we believe will have a positive impact on the margin in the future. Further, we anticipate that the EBITDA margin would have a similar trajectory as FY24 with a stronger H2 compared to H1.”

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