Arohan Financial Services Limited: An Overview of the company

Monday, Mar 4, 2024


ISIN
INE808K01017

Face Value

Rs. 10.00

Total Shares

12,11,77,303

P/E of the share

18.83

Market Capitalization

Rs. 1333crores

Industry

BFSI

Book Value

Rs. 111.40

P/B of the share

0.99

Category

Pre-IPO

IPO Status

2024

DRHP Status

Filed in 2021

Promoter’s Holding

34.32%

About - 

Arohan Financial Services Limited (‘the Company’) is incorporated under the provisions of the Companies Act 1956. The Company has been registered as a Non-Banking Financial Company (‘NBFC’) with the Reserve Bank of India (‘the RBI’) from 8 July 2009 and pursuant to the notification issued by the RBI for classification of NBFCs as Non-Banking Finance Company – Micro Finance Institutions (‘NBFC-MFI’), the Company’s application for registration as an NBFC-MFI was approved by the RBI on 10 January 2014. 

The Company is primarily engaged in providing the livelihood promotion services such as micro-credit to socio-economically disadvantaged customers un-reached by the formal banking systems. In addition to the core business of providing micro-credit, the company uses its distribution channel to provide certain other financial products and services.

The major shareholders in the company are Aavishkaar Venture Management Services Private Limited, AavishkaarGoodwell India Microfinance Development Company II Limited, Tano India Private Equity Fund II, Intellectual Capital Advisory Services Private Limited, Maj Invest Financial Inclusion Fund II and TR Capital III Mauritius.

Business Offerings -

  • Arohan is one of the very few microfinance organizations to provide loans of amounts ranging from INR 10,000 to INR 25 Cr, including Term Loans to small MFIs operating in remote parts of various Low Income States or financially underpenetrated states in India. This allows the Company to cater to the credit needs of a wide range of customers, across the bottom half of the socio-economic pyramid, while also adding innovative products to its suite, creating sustainable market advantage.



Financial Highlights -

(figures in crores except EPS)

Particulars

Year ended

31.03.2023

Year ended

31.03.2022

Total Revenue

1091

920

Expenses

1001

837

PBT

89

82

PAT

68

59

EPS

5.84

5.20

Major Highlights of the company-

  • By the end of March, a microfinance institution (MFI) managed assets worth Rs. 5,357 crore. Their expansion plans for this year include entering Gujarat, Haryana, and Maharashtra, in addition to expanding their presence in Madhya Pradesh and Uttar Pradesh.
  • As of March 2023, the MFI operates 835 branches across 15 states.
  • Arohan Financial Services, a microfinance institution affiliated with the Aavishkaar-Intellecap Group, has secured approximately Rs. 200 crore ($24 million) in funding from the Investment Fund for Developing Countries (IFU). The IFU is a development finance institution supported by the Danish government.
  • Recently, the company raised funds of Rs. 730 crore through a share sale to private equity investors. With this capital infusion, the microloan lender anticipates surpassing Rs. 10,000 crore in assets under management by March 2025.
  • In their initial fundraising round in 2019, the company successfully raised Rs. 168 crore.
  • Despite having obtained approval for an initial public offering (IPO) in April 2021, the company had to abandon the plan due to market volatility.
  • Within the next 24 months, the company aims to revive its IPO plan.

Company in News -

  • Arohan Financial Snags $24 Mn from Another DFI. 

https://www.vccircle.com/arohanfinancial-snags-24-mn-from-another-dfi(3 july 2023)

  • Arohan Financial Services raises Rs. 730 crores in share sale to private equity investors.

https://economictimes.indiatimes.com/industry/banking/finance/arohan-financial-services-raises-rs-730-crore-in-share-sale-to-private-equity-investors/articleshow/99358849.cms (9 Apr 2023)

  • FMO proposes $11.1 Mn investment in India’s Arohan Financial Services. 

https://www.dealstreetasia.com/stories/fmo-invests-in-arohan-financial-334144 (13 March 2023)

  • Arohan Financials in talks with PEs to raise Rs.1900 crores. 

https://economictimes.indiatimes.com/markets/ipos/fpos/arohan-financials-sheds-ipo-renewal-plan-to-raise-equity-from-pe-investor/articleshow/92810513.cms (12 July 2022)

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