Broker’s Call: U GRO Capital (Buy)

‘Our view is that the transmission of interest rates is not as high as the need for credit demand for working capital and term loans. So we don’t see that as a challenge’

We are in the underserved market, not unserved: U Gro Capital VC & MD

The coupons are higher than those on fixed deposits. But weigh the risks before investing

U Gro Capital NCD offers up to 10.5% interest: Should you invest?

Through this collaboration, the brands will provide MSMEs with financing of more than Rs 2,000 cr by March 2023

Yubi ties up with U GRO Capital for co-lending and supply chain financing

GRO–Xstream and Yubi CoLend to will provide MSMEs with financing of more than ₹2,000 crore by March 2023

Yubi, U GRO Capital tie up for co-lending, supply chain financing to MSMEs

Through this alliance, U GRO Capital will gain access to Yubi Co.Lends vast network of banks, financial institutions and fintechs via a single API integration to extend and accelerate credit to the underserved sectors in the country.

Yubi | U GRO: Yubi partners with U GRO Capital for co-lending and supply chain financing

The company aims to grow its loan book under co-lending partnerships by 3X to over Rs 2,000 crore by March 2023.

U GRO Capital: U GRO Capital’s AUM crosses Rs 3,650 crore, with disbursement of Rs 1,350 crore in Q1 FY23

The company was envisaged to be an independent listed public institution supported by marquee institution shareholders and supervised and managed by independent board of directors.

U GRO Capital net profit up by 292% to Rs 6.08 crore in Q4 FY2022

Credit and Finance for MSMEs: U GRO’s assets under management (AUM) as of March 31, 2022, stood at Rs 2,969 crore compared to Rs 1,317 crore as of March 31, 2021, a 125 per cent increase on a YoY basis.

MSME lender U GRO Capital Q4 PAT jumps nearly 300%; disbursements grow 114% | The Financial Express

The issue opened for subscription on April 07, 2022, and closed on May 06, 2022.

U GRO Capital’s Rs 100-cr NCD issue subscribed 1.44 times | The Financial Express

Credit and Finance for MSMEs: ”“We have generated significant profitability for the business. Absolute profit in FY23 would be 4X of what we would end up at in FY22,” said U GRO’s Shachindra Nath.

U GRO Capital: MSME loans jump 2.5X to over Rs 3,000 crore in FY22; to disburse Rs 5,000 crore loans this year | The Financial Express

Hasn't faired well - amongst the low performers

Performance

Seems to be overvalued vs the market average

Valuation

Financials growth has been moderate for a few years

Growth

Average profitability - not good, not bad

Profitability

The stock is overpriced but is not in the overbought zone

Current price is more than the intrinsic value

Fundamentals

Good time to consider, stock is not in the overbought zone

Technicals

Entry point

Promoter pledged holding

Unsolicited messages

Default probability

Red flags

Ugro Capital, formerly Chokhani Securities, is engaged in broking, arbitrage, institutional dealing, research, and IPO distribution.

Ugro Capital Ltd