Moneyboxx Finance Limited , a non-banking financial company (NBFC), has reported a 16% year-on-year growth in Assets Under Management (AUM) to INR 892.00 crores in Q2 FY26, up from INR 769.00 crores in Q2 FY25. The company's strategic shift towards secured lending and higher-value loans is reshaping its portfolio mix and risk profile.

Key Financial Highlights

• Total income grew 10% year-on-year to INR 55.00 crores
• Profit after tax declined to INR 0.30 crores from INR 2.30 crores in the previous year
• Disbursements reached INR 115.00 crores, up 23% from the previous quarter

Strategic Shift to Secured Lending

Moneyboxx Finance is making a significant transition towards secured lending:

• Secured disbursements accounted for 69% of total disbursements in Q2 FY26, up from 43% in Q2 FY25
• Secured loan book now represents 55% of total AUM, compared to 32% in Q2 of the previous year
• The company targets a 70% secured lending share by March 2026

Portfolio Diversification and Quality Improvement

The company is actively diversifying its portfolio and improving credit quality:

• Livestock-based disbursements reduced from 64% in Q1 FY25 to 37% in Q2 FY26
• Loans with average ticket size of INR 5-10 lakhs have grown fivefold to 60% from 19% in terms of disbursement
• 72% of disbursements in Q2 FY26 were to customers with credit bureau scores of 650 and above, up from 50% last year

Asset Quality and Collections

• Gross NPA improved to 3.26% from over 7% in Q1, largely due to an ARC transaction
• Overall collection efficiency stood at 92.5%
• Collection efficiency for secured loans was 96%

Operational and Financial Metrics

• Operating expenses as a percentage of AUM stood at 12.7%, slightly lower than 12.8% in FY25
• Average lending IRR stood at 26.4%, while average borrowing IRR reduced to 12.8%
• The company maintains a liquidity buffer of INR 97.00 crores

Future Outlook and Initiatives

• Moneyboxx Finance aims to bring operating expenses below 10% over the next two years
• The company targets 25-30% year-on-year AUM growth in the coming year
• A proprietary Cattle AI solution was launched in March 2025 to enhance cattle verification for secure gold lending

Capital Raise and Shareholder Value

• The company raised a total equity of INR 175.80 crores, with INR 84.72 crores expected by March 2026
• Current Capital to Risk (Weighted) Assets Ratio (CRAR) stands at 27.1%
• The Board has approved a 1:1 bonus share issue

Moneyboxx Finance's strategic shift towards secured lending and higher-value loans appears to be a prudent move in the current economic environment. While the transition has impacted short-term profitability, it positions the company for potentially more stable growth and improved asset quality in the long term. The focus on portfolio diversification and improved credit quality should help mitigate risks associated with sector-specific exposures.

However, investors should note the decline in profit after tax and monitor how the company manages the transition to a predominantly secured lending model. The success of this strategy will depend on the company's ability to maintain growth while improving asset quality and operational efficiency.

The approval of a 1:1 bonus share issue is a positive signal for shareholders, potentially enhancing liquidity and signaling management's confidence in the company's future prospects. As Moneyboxx Finance continues to evolve its business model, close attention should be paid to its ability to execute its strategic initiatives and deliver sustainable growth in the competitive NBFC sector.

Moneyboxx Finance Limited has announced a significant capital raise, a proposed bonus share issue, and reported on its fund utilization from a preferential issue, signaling strong growth and investor confidence in the company's future.

Capital Raise and Financial Performance

Moneyboxx Finance has successfully raised INR 478.00 crore in term debt since January, demonstrating its robust fundraising capabilities. The debt has been sourced from various avenues:

This diverse funding mix highlights the company's strong relationships with lending institutions, including 11 banks and 19 financial entities.

The company has shown remarkable improvement in its asset quality. The Gross Non-Performing Asset (GNPA) ratio has significantly decreased from 7.28% to 3.26%. This improvement is attributed to an Asset Reconstruction Company (ARC) transaction and enhanced collection efforts.

As of September 30, Moneyboxx Finance reported:

• Capital to Risk-weighted Assets Ratio (CRAR): 27.1%
• Net Worth: INR 262.00 crore
• Debt-to-Equity Ratio: 2.41
• Liquidity: INR 97.00 crore

These figures indicate a strong capital position and healthy financial metrics.

Proposed Bonus Share Issue

Moneyboxx Finance's Board of Directors has recommended a bonus share issue, subject to shareholder approval. The key details of the proposed bonus issue are:

• Ratio: 1:1 (One new fully paid-up equity share for every one existing fully paid-up equity share)
• Face Value: INR 10.00 per share
• Capitalization Amount: Up to INR 37,50,27,450.00 from the Securities Premium Account

The bonus shares, once issued, will rank pari-passu with the existing equity shares in all respects.

Impact on Convertible Securities

The company has 37,37,745 outstanding convertible warrants and 10,60,400 employee stock options. Holders of these securities may be eligible for the bonus issue, subject to conversion or exercise of their respective instruments by the record date.

Preferential Issue Fund Utilization

Moneyboxx Finance has submitted its monitoring agency report for the quarter ended September 30, detailing the utilization of funds raised through its preferential issue:

• Total funds raised: INR 175.80 crore (revised down from the original INR 271.48 crore due to undersubscription)
• Allocation:
  • Onward lending purposes: INR 165.80 crore
  • General corporate purposes: INR 10.00 crore
• Utilization as of quarter end:
  • Lending purposes: INR 89.02 crore
  • General corporate purposes: INR 2.06 crore
  • Unutilized: INR 84.72 crore

The monitoring agency, Crisil Ratings Limited, reported no deviation from the stated objects of the issue.

Future Outlook

Moneyboxx Finance has indicated a strong pipeline for future funding, with debt discussions exceeding INR 500.00 crore. This suggests continued growth momentum and expansion plans for the company.

The proposed bonus issue and robust capital raise demonstrate Moneyboxx Finance's commitment to rewarding shareholders while maintaining a strong financial position for future growth.

Shareholders are advised to await further details on the record date and other specifics of the bonus issue, which will be communicated in due course.

It's worth noting that the company issued warrants at INR 302.20 per share, while the current market price stands at INR 167.56 as of October 24, indicating a potential risk of non-exercise of conversion rights. Warrant holders have 18 months from the allotment date to convert warrants into equity shares.