Ugro Capital Q2 profit falls 14% to ₹37 crore

Ugro Capital, a technology-driven NBFC focused on MSME lending, on Thursday reported a 14% decline in net profit to ₹37 crore in the quarter ended September.

The company had recorded a net profit of ₹43 crore in the same quarter a year ago.

Total income increased to ₹496 crore during the quarter under review from ₹461 crore in the same period last year, Ugro Capital said in a regulatory filing.

However, the company earned lower interest income of ₹313 crore during the quarter, compared with ₹322 crore in the same period a year ago.

Total expenses also increased to ₹446 crore from ₹400 crore in the second quarter of the previous fiscal.

Disbursements rose to ₹3,159 crore in the second quarter, up 77% year-on-year.

Shareholders and creditors of Ugro approved the merger of Profectus Capital into the NBFC on September 23, 2026. The NCLT's final hearing in the matter is scheduled for November 20.

On completion of the merger, the company said, income from co-lending and direct assignment loans will be recognised over the period these loans actually run, rather than over their full contractual term.

This will reduce the impact of reversals that unsettled past results, making reported profits steadier and more predictable in the coming quarters, it said.

Capital adequacy on a merged basis will be approximately 22%, comfortably above regulatory requirements, allowing Ugro to fund growth without raising fresh equity.