Arohan Financial Services Unlisted Shares

About Company

Arohan Financial Services Limited is a leading NBFC-MFI operating primarily in financially under-penetrated low-income states of India. The company focuses on providing income-generating microfinance loans and other financial inclusion products to customers with limited or no access to formal banking services.

Founded in 2006, Arohan Financial has built a strong presence in eastern India and has gradually expanded its footprint across multiple states through a structured and risk-controlled lending model.

Business Model & Focus Areas

The following explains the core business operations of Arohan Financial Services Limited.

Arohan Financial follows a well-established NBFC-MFI lending framework, supported by:

• Robust risk management systems
• Structured loan approval processes
• Strong recovery and collection mechanisms

The company primarily offers microfinance loans, with a smaller but growing presence in MSME lending. Notably, 97% of microfinance borrowers are women, reflecting the company’s focus on women-led financial inclusion.

Market Position & Scale

The following highlights Arohan Financial Services Limited’s industry standing:

• Largest NBFC-MFI in Eastern India
• 5th largest NBFC-MFI in India by Gross Loan Portfolio (as of September 30, 2020)
• Among the top five NBFC-MFIs, Arohan reported the second-highest loan portfolio CAGR of 68% over the last three years

Geographical Presence & Branch Network

The following outlines the operational footprint of Arohan Financial Services Limited. As of March 2023:

• Microfinance business:
  • 829 branches
  • Operations across 11 states
• MSME lending business:
  • 10 branches
  • Presence in 8 states

This diversified presence helps reduce regional concentration risk while supporting portfolio growth.

Loan Portfolio & Growth

The following summarises key portfolio metrics.

• Gross Loan Portfolio (GLP): ₹5,357 crore (as of March 2023)
• Strong portfolio expansion driven by branch additions and deepening rural penetration
• Women borrowers constitute the dominant share of the loan book

Financial Performance Snapshot

The following is a concise financial overview based on available data.

• FY23 Highlights:
  • Revenue: ₹1,090 crore
  • Profit After Tax (PAT): ₹71 crore
  • Gross NPA: 2.80%
• Balance Sheet Metrics (as on 31.03.2023):
  • Book Value: ₹90 per share
  • EPS: ₹6

Promoters & Shareholding

The following outlines the promoter and investor base of Arohan Financial Services Limited.

Promoters

• Aavishkaar Venture Management Services Private Limited (AVMS)
• Intellectual Capital Advisory Services Private Limited (I-Cap)

Institutional Investors

• Tano India Private Equity Fund II
• Maj Invest Financial Inclusion Fund II K/S
• Michael & Susan Dell Foundation
• TR Capital III Mauritius
• ASK Financial Holding Private Limited
• Kiran Vyapar Limited

IPO Update

The following highlights recent corporate developments.

Arohan Financial Services Limited has filed its DRHP for a proposed IPO, signalling the company’s intent to access public markets. Further details on issue size, pricing, and timelines are awaited.

Challenges & Risks

The following outlines key risks associated with the business:

• Exposure to economically vulnerable borrower segments
• Sensitivity to regulatory changes in the microfinance sector
• Asset quality pressures during economic disruptions
• Dependence on consistent collection efficiency for profitability

Quick Summary

This section provides a brief snapshot of Arohan Financial Services Limited:

• Established NBFC-MFI with a strong eastern India presence
• Rapid portfolio growth with a diversified branch network
• High focus on women borrowers and financial inclusion
• Backed by reputed venture and institutional investors
• IPO filing indicates next phase of growth and transparency