Shares of Fusion Microfinance fell 20% to the lower circuit and hit a 52-week low of ₹346.4 on the NSE on Wednesday, August 7, after the company reported a net loss and poor asset quality in the first quarter of the current financial year.
With today’s fall, the stock has slipped below its initial public offering (IPO) price of ₹368 per share.
Fusion Microfinance reported a net loss of ₹35.62 crore in Q1FY25, compared to a profit of ₹120.46 crore in the same quarter last fiscal. Sequentially, the company also posted a net profit of ₹132.69 crore in Q4FY24.
The company reported poor asset quality in Q1FY25 as its gross non-performing assets (GNPA) ratio increased by 7,063 basis points (bps) to 5.46% from 3.2% in the corresponding quarter of the previous financial year. Sequentially, the microfinance company’s GNPA ratio fell by 2.89% to 889.3 bps in Q4FY24.
In Q1FY25, the microfinance institution’s Return on Assets (RoA) turned negative and stood at 1.19%, down 12,385 bps from 4.99% in Q1FY24.
The microfinance institution reported over 25% growth in its assets under management (AUM) in Q1FY25 as it increased to ₹12,192.58 crore from ₹9,711.75 crore in Q1FY24.
On a quarter-on-quarter basis, the company’s AUM also grew by 6.24% from ₹11,476.08 crore in Q4FY24.
The company’s total income grew by nearly 28% year-on-year to ₹706.68 crore in Q1FY25, compared to ₹552.78 crore in Q1FY24. The microfinance firm’s total income for Q1FY25 also increased by over 4% from ₹675.14 crore in Q4FY24.
Its net interest income (NII) for Q1FY25 grew by nearly 35% year-on-year to ₹396.55 crore compared to ₹294.07 crore in Q1FY24. Sequentially, NII grew 10% from ₹359.98 crore in Q4FY24.
In Q1 FY25, the company’s net interest margin (NIM) also increased by 689 bps year-on-year to 11.64% from 10.89% in Q1 FY24. NIM increased by 11.59% by 43 bps in March quarter of FY24.
Fusion Microfinance’s disbursements grew 30.73% year-on-year to ₹2,986.65 crore in Q1FY25 from ₹2,284.61 crore in Q1FY24. The company’s borrower base increased to Rs 39.5 lakh in Q1FY25. The company also opened 101 new branches, taking the total branch network to 1,398.
