Shares of UGRO Capital surged over 7 p.c in intraday commerce on Wednesday, June 18, following the corporate’s announcement of buying Mumbai-based NBFC Profectus Capital Personal Restricted in an all-cash deal price ₹1,400 crore. The acquisition, topic to shareholder and regulatory approvals, is predicted to be accomplished within the subsequent two to 3 months.
The deal shall be financed by means of a mixture of UGRO’s lately concluded ₹400-crore rights situation and inside accruals. UGRO can also situation compulsorily convertible debentures to fund the stability. The corporate mentioned the strategic acquisition will instantly increase its property below administration (AUM) by 29 p.c, growing the whole consolidated AUM to roughly ₹15,471 crore. Profectus brings a ₹3,468 crore mortgage ebook to UGRO’s portfolio.
UGRO Capital introduced that it’ll utilise the funds raised by means of its latest fairness issuance to finance the acquisition of Profectus Capital. In line with the corporate’s assertion, the capital shall be directed towards constructing a completely secured asset base that gives quick scale benefits with out incurring origination prices. UGRO additional acknowledged that Profectus’ secured lending operations are a strategic match, aligning seamlessly with UGRO’s data-centric underwriting mannequin.
“To facilitate the discharge of buy consideration for the proposed acquisition, the corporate is proposing so as to add financing of Profectus’ acquisition as an object of the present preferential issuance of compulsorily convertible debentures by in search of contemporary approval from the board and shareholders,” UGRO mentioned including the deal can also be topic to the approval of the Reserve Financial institution of India (RBI) and shareholders.
Acquisition to Drive Profitability
In line with UGRO Founder and MD Shachindra Nath, “This strategically priced acquisition deploys our fairness elevate to attain prompt scale, ₹115 crore in price financial savings, and an annualised incremental revenue of ₹150 crore—boosting our RoA by 0.6 to 0.7 p.c.” The transfer is geared toward diversifying UGRO’s lending base and deepening its footprint in high-yield areas like embedded finance and MSME lending.
Profectus Capital primarily focuses on secured lending merchandise akin to college financing, loans towards property, and provide chain finance. Working by means of 28 branches throughout seven Indian states, the NBFC had gross NPAs of 1.6 p.c and internet NPAs of 1.1 p.c as of March 2025. As soon as the acquisition is full, Profectus will develop into a completely owned subsidiary of UGRO Capital. The 2 firms are anticipated to merge efficient April 1, 2025.
UGRO’s administration expects the mixed entity to realize from enhanced lender relationships, with entry to Profectus’ community of personal and small finance banks.
The acquisition is structured by means of a share buy settlement, with UGRO buying 100% of Profectus Capital’s shares from present shareholders. InCred Capital served because the unique advisor to UGRO Capital, with authorized and monetary due diligence help offered by SNG & Companions and PwC, respectively. Avendus Capital suggested Profectus Capital and its shareholders.
Market Response
Traders welcomed the acquisition information, sending UGRO Capital shares up 7 p.c to an intraday excessive of ₹183.35 on the BSE. Regardless of the uptick, the inventory nonetheless trades greater than 37 p.c beneath its 52-week excessive of ₹294, final touched in July 2024. The scrip had hit its 52-week low of ₹144.11 in March 2025.
UGRO Capital has had a unstable efficiency over the previous 12 months. The inventory has declined over 38 p.c within the final 12 months. In June to date, it has slipped round 1 p.c after gaining 1 p.c in Might and over 7 p.c every in April and March. Previous to this rally, the inventory had posted losses for 5 consecutive months between October 2024 and February 2025.
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