UGRO Capital Limited submitted its investor presentation for the quarter and nine months ended December 31, 2025, to BSE and NSE under Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Financial Performance Highlights

The company reported robust performance metrics for Q3FY26, with consolidated results showing significant improvements across key parameters. The presentation revealed strong asset growth and profitability indicators despite some margin compression.

Nine Months Performance Overview

For the nine months ended December 31, 2025, the company demonstrated sustained growth momentum with improved operational metrics and maintained asset quality standards.

Product Portfolio and Asset Quality

The presentation highlighted UGRO Capital's diversified product mix with Secured Business Loans comprising 23% of AUM, followed by Emerging Market LAP at 21% and Machinery Loans at 15%. The company maintained stable asset quality with GNPA at 2.2% and NNPA at 1.4% as of December 2025.

ESG Framework Implementation

UGRO Capital announced the launch of its Environmental & Social Management System (ESMS), aligning with global ESG benchmarks and IFC ESMS Framework. The Board-approved system reinforces the company's commitment to responsible MSME financing and enhances investor confidence through robust screening and monitoring processes.

Liability Management and Co-lending

The company maintained a diversified lender base with total debt of ₹10,716 crore and cost of borrowings at 10.24%. Off-book AUM constituted 36% of total portfolio through partnerships with 16 co-lenders and co-originators, demonstrating effective capital efficiency strategies.

Corporate Governance and Leadership

The presentation emphasized UGRO Capital's institutional ownership structure with majority shareholding by institutional investors including Investment Fund for Developing Countries (15.8%), TPG Newquest (9.8%), and ADV Partners (9.8%). The leadership team brings 180+ years of cumulative experience across financial services.

Source: UGRO Capital Limited regulatory filings and investor presentation

UGRO Capital Limited has received a 'CareEdge B+/Stable' rating from CareEdge Global IFSC Limited for its USD 50 million External Commercial Borrowing facility. The rating announcement was made through a regulatory filing dated January 30, 2026, highlighting the company's strong business fundamentals while acknowledging certain operational challenges.

Rating Details and Rationale

The Long-Term Foreign Currency rating reflects UGRO Capital's robust business profile, supported by a substantial and predominantly secured asset base. As of September 30, 2025, the company's Assets Under Management stood at Rs 12,226 crore, with approximately 70% comprising secured products including loan against property and machinery loans.

Business Profile Strengths

UGRO Capital demonstrates strong diversification across multiple dimensions. The company's product suite caters to nine MSME segments, while its geographic diversification remains robust with the top six states accounting for around 65% of AUM. The secured business loan segment accounts for a significant portion of the portfolio, providing stability and reducing credit risk.

The company has delivered exceptional growth, with AUM increasing from approximately Rs 1,300 crore in FY21 to over Rs 12,200 crore by H1FY26, representing a CAGR of nearly 56%. This growth trajectory was further strengthened by the acquisition of Profectus Capital Private Limited, completed on December 08, 2025, at a cost of Rs 1,400 crore.

Asset Quality and Financial Performance

The rating assessment reveals moderate asset quality metrics that partially offset the company's strengths. Key financial indicators as of September 30, 2025, include:

The company's profitability remains modest, primarily due to elevated operating costs at 3.4% on average managed assets for H1FY26 and borrowing costs of approximately 10.3%. These factors have kept the Return on managed assets at 1.0% in H1FY26, compared to 1.2% in FY25.

Strategic Acquisition and Future Outlook

The acquisition of Profectus Capital, which had a loan book of Rs 3,400 crore and net worth of Rs 1,200 crore, is expected to generate synergies through branch rationalization and a more secured product portfolio. Management anticipates benefits from school loans and machinery loans, though the actual impact will be assessed over the next 12-18 months.

Post-acquisition, UGRO's combined AUM stands at approximately Rs 15,500 crore, enhancing diversification with school financing and strengthening prime LAP and machinery finance segments.

Rating Outlook and Sensitivities

The stable outlook reflects CareEdge Global's expectation that UGRO Capital will maintain its current financial and operational profile over the medium term with consistent growth in scale of operations. Upward rating factors include achieving gearing of less than 3x on a sustained basis and RoA exceeding 2% annually. Conversely, downward pressures could emerge if gearing crosses 4x or credit costs exceed 4.5%.

Source: UGRO Capital Limited regulatory filing and CareEdge Global IFSC Limited press release