UGRO Capital Limited's Board of Directors has approved a comprehensive amalgamation scheme with its wholly owned subsidiary, marking a significant step in the company's consolidation strategy. The board meeting held on January 8, 2026, approved the Scheme of Amalgamation with Profectus Capital Private Limited (PCPL) under Sections 230-232 read with Section 52 of the Companies Act, 2013.

Merger Details and Regulatory Framework

The amalgamation scheme requires extensive regulatory approvals from multiple authorities. The merger is subject to sanction from the National Company Law Tribunal (NCLT) and approvals from stock exchanges, Securities and Exchange Board of India (SEBI), Reserve Bank of India (RBI), shareholders, creditors, and other statutory authorities as required.

Financial Profile of Merging Entities

The financial performance of both entities demonstrates substantial business operations across the MSME financing sector.

PCPL Financial Performance:

UGRO Capital Financial Performance:

Business Operations and Strategic Rationale

Both entities operate as non-deposit taking NBFCs classified as middle layer NBFCs registered with RBI. PCPL specializes in secured lending to micro, small and medium enterprises (MSMEs) and offers customized products with cluster-specific features. The subsidiary also undertakes factoring business on Trade Receivables electronic Discounting System (TReDS) platform.

UGRO Capital provides diversified financial products including business loans, loans against property, machinery and equipment finance, and working capital support to MSMEs. The merger aims to achieve several strategic objectives:

• Strengthened asset mix with higher secured assets to scale Emerging Market and Embedded Finance businesses
• Geographic and product alignment in Secured Loan Against Property (LAP) and Machinery Finance
• Operational synergies for expansion and sustainable growth
• Optimal capital utilization and enhanced operational efficiencies
• Reduction in management overlaps and regulatory compliance costs
• Improved organizational capability through pooling of diverse human capital

Additional Board Decisions

The board also approved an increase in borrowing limits for Commercial Papers from ₹500 crores to ₹800 crores, building upon the board approval dated April 26, 2025. Powers have been delegated to Principal Officers under Section 179 of the Companies Act, 2013.

Transaction Structure

Since PCPL is a wholly owned subsidiary, no cash consideration or share exchange will occur. Upon the scheme becoming effective, shares held by UGRO Capital in PCPL will stand cancelled without any further action. The merger will not result in any change to UGRO Capital's equity shareholding pattern, as confirmed in the regulatory filing.

UGRO Capital has received approval for its merger with Profectus Capital, marking a significant development in the company's strategic expansion plans.

Merger Details

The approval for the merger between UGRO Capital and Profectus Capital represents a key corporate restructuring initiative. This consolidation is expected to create synergies between the two entities and strengthen their combined market presence in the financial services sector.

Strategic Implications

The merger approval demonstrates UGRO Capital's commitment to growth through strategic partnerships and acquisitions. By combining operations with Profectus Capital, the company aims to enhance its service offerings and expand its operational footprint.

Corporate Development

This merger represents a significant milestone in UGRO Capital's corporate development journey. The approval process completion indicates that all necessary regulatory and internal requirements have been satisfied, paving the way for the integration of both companies' operations and resources.