India’s UGRO Capital, a data-tech-focused NBFC, on Tuesday said it has signed a deal to acquire MSME lender Profectus Capital in an all-cash deal worth Rs 1,400 crore ($164 million).
The deal is expected to give UGRO access to Profectus’ fully secured loan book of Rs 3,468 crore, a 28-branch network across seven states, and a team of over 800 employees. Profectus posted Rs 27 crore in FY25 profit and maintains a gross NPA of 1.6%.
The acquisition is expected to add Rs 150 crore in annualised profit to UGRO, with estimated operational cost savings of Rs 115 crore post-merger, the firm said in a statement.
UGRO’s assets under management (AUM) will rise 29% to Rs 15,471 crore on a consolidated basis, while the share of secured loans will increase from 70% to 75%, improving the risk profile of the overall book. UGRO expects return on assets (ROA) to improve by 60–70 basis points post-acquisition.
The acquisition, funded through a combination of UGRO’s recent equity raise and internal accruals, will also give UGRO access to Profectus’ diverse lender network, especially private sector banks and DFIs, which will help strengthen its liability profile.
With a consolidated 263-branch footprint, UGRO plans to accelerate expansion in high-yield segments such as supply chain finance, machinery loans, and embedded finance.
