Small business lending fintech platform U GRO Capital is planning to increase its micro-enterprise mix to 20% by the end of 2024-25 (April-March) from 12% at present, founder and managing director Shachindra Nath has said.
The company’s assets under management (AUM) rose 64% year-on-year to Rs 8,364 crore as on December 31. The surge has been attributed to strategic investments in distribution channels, diversified borrowing profile, and a data-centric underwriting model.
Prime-secured and prime-unsecured loans comprise 55% of the overall book. Micro-enterprise loans, supply-chain financing, machinery loans, partnerships and alliances comprise the remaining 45%.
The company is poised to have AUM of around Rs 9,400 crore by March 31. Net loans originated, or disbursements, rose to Rs 1,550 crore in the December quarter, from Rs 1,164 crore a year ago.
“Our long-term aspiration is to take 1% market share and get to sizeable assets under management,” Nath said. Currently, around 45% of the company’s AUM is off-balance sheet exposure. The company expects the co-lending mix to rise to 50% by March 31.
Total debt stood at Rs 4,170 crore as on December 31. Loans from banks and non-bank lenders comprised 53% of the liability mix. The remaining 47% of borrowings came from development finance institutions, capital markets, and foreign institutional investors.
In the next two quarters, the company is looking to expand its presence in 75 locations of Uttar Pradesh, Andhra Pradesh, and Madhya Pradesh. In the next one year, these three states will contribute Rs 1,000 crore to the company’s AUM.
“We are looking at 20 locations in UP, including Varanasi. The economic value creation in states like Uttar Pradesh and Madhya Pradesh will be significant in the coming years due to cultural and religious tourism,” Nath said.