UGRO Capital is set to complete its acquisition of Profectus Capital within this month, a move that will immediately add Rs 3,000 crore to its asset base and help the company surpass its AUM target of Rs 15,000 crore, Founder and Managing Director Shachindra Nath said in an interaction. Earlier, the deal was expected to be completed by October 31.
With this inorganic boost, UGRO expects to close the fiscal with a consolidated AUM of Rs 16,500–17,000 crore, including Rs 12,000 crore from its existing book and the remainder from Profectus and calibrated organic additions. The assets under management grew 20% year-on-year to Rs 12,226 crore as of September 30.
Looking ahead, the company anticipates most of its incremental growth to come from two key segments — micro LAP (loan against property) disbursed through its fully built-out branch network, and embedded finance via its digital partnerships with platforms like PhonePe, Fino, and BharatPe. These segments are expected to contribute significantly to the Rs 1,000 crore of additional assets UGRO plans to add over the next two quarters, he said.
With scale now achieved, UGRO is shifting focus to productivity and cost optimisation. The company is slowing organic disbursements to reduce its cost of borrowing by 100 basis points over the next six quarters. On branch productivity, he expects that in the next 18 months, all 303 branches will have an average disbursement of Rs 1 crore.
“While we have been cautious of the fact that the small ticket micro-LAP and unsecured have been under stress, that’s why we have reduced the approval rates and disbursements have been slow. But we are seeing very consistent portfolio quality,” he said.
On the liability side, UGRO’s off-balance sheet book stands at Rs 5,271 crore, or 43% of total AUM, with co-lending contributing Rs 2,484 crore. However, with Profectus being a fully on-book NBFC, the off-book share is expected to moderate to 35% in the near term. Over the long run, UGRO intends to maintain this ratio in the 30–35% range, balancing risk and capital efficiency.
On Friday, the non-bank lender reported a net profit of Rs 43.3 crore, up 22% year-on-year for the quarter ended September. Shares of UGRO Capital closed 0.2% lower at Rs 176.90 on NSE.