Moneyboxx Finance, an impact lender specializing in small business loans for micro-entrepreneurs, reported a significant turnaround in profitability for FY24. The company achieved a net profit of INR 9.14 crore, a stark contrast to the net loss of INR 6.80 crore in FY23.
Moneyboxx experienced a remarkable 112% growth in Assets Under Management (AUM), reaching INR 730 crore as of March 31, 2024. This growth was driven by branch expansion, increased productivity, and enhanced lending partnerships. The company is supported by 32 lenders, including major banks like State Bank of India, HDFC Bank, and Kotak Mahindra Bank, and maintains a robust capital position to support its growth plans.
Key Financial Highlights for Q4 FY24 and FY24
- Expansion and Diversification: The company expanded its operations to 100 branches across 8 states, up from 61 branches in 6 states the previous year. Geographic and product diversification improved with the entry into Gujarat and Bihar and an increased share of secured lending, which grew from 5% of AUM at FY23-end to 24% at FY24-end.
- AUM Growth: AUM grew by 112% to INR 730 crore as of March 31, 2024, compared to the previous year, driven by branch expansion, higher productivity, and growth in lending partnerships. Disbursements reached INR 665 crore during FY24, a 95% increase over the previous year.
- Turnaround in Profitability: Total income surged by 154% to approximately INR 128 crore in FY24, up from INR 50.4 crore in FY23, in line with the strong growth in AUM. The company posted a profit after taxes of INR 9.14 crore in FY24 compared to a net loss of INR 6.80 crore in FY23.
- Return on Equity (ROE): Achieved an ROE of 10.1% in Q4 FY24 and 8.1% in FY24. Profitability is expected to improve further due to declining borrowing costs, improved branch productivity, and operating leverage benefits from the growing scale of operations.
- Strong Balance Sheet: Moneyboxx strengthened its capital base by raising INR 85 crore of equity during FY24. The leverage ratio (TOL/Owned Funds) was comfortable at 3.54 as of March 31, 2024, compared to 3.67 the previous year. Net worth more than doubled to INR 168.9 crore as of March 31, 2024, from INR 76.4 crore the previous year.
- Diversified Funding Mix and Reduced Borrowing Costs: The company has diversified its funding sources with the addition of leading banks and NBFCs, as well as issuing debt via securitization and NCD issuance. The cost of incremental borrowing stood at 13.0% during H2 FY24. Moneyboxx is supported by 32 lenders, including 10 leading banks.
- Asset Quality: Despite challenges posed by high and erratic rains affecting the agriculture-driven rural economy in states like Punjab, Haryana, Rajasthan, and Uttar Pradesh, Moneyboxx maintained relatively strong asset quality. Gross NPA increased to 1.54% of AUM as of March 31, 2024, from 0.59% the previous year, and Net NPA increased to 1.04% from 0.30%. The company expects to maintain stable asset quality with an increasing focus on secured lending (24% of AUM as of March 2024 compared to 5% the previous year).
Commenting on the results, Deepak Aggarwal, Co-CEO & CFO, said, “Strong quarterly momentum in profitability in FY24 validates the strengths of our tech-driven, scalable, and sustainable business model. With a proven business model to cater to the promising and underserved small business loan market in rural and semi-urban areas, we aim to transform the lives of micro-entrepreneurs through impact financing and various beyond-lending initiatives, such as free vet advisory and agro-forestry for livestock and agricultural borrowers.”