By BullScreen Editorial Team 
Ugro Capital Limited reported a solid performance in its Q4 results 2026, with profit after tax (PAT) rising 21% year-on-year to ₹174.8 crore, supported by a strategic shift toward high-yield lending segments.
The company’s total income grew 40% YoY to ₹2,021.1 crore, driven by a 43% jump in interest income. Despite a marginal 1% quarter-on-quarter dip in assets under management (AUM) to ₹15,334 crore, Ugro Capital maintained strong annual growth of 28%, reflecting stable business momentum during its portfolio realignment.
In February 2026, the company initiated a strategic pivot focusing on “Focus Verticals” such as Emerging Market LAP and Embedded Merchant Finance. These segments increased their share in AUM from 32% to 38% within a single quarter, highlighting rapid execution.
The Embedded Merchant Finance business scaled sharply, growing sixfold in just 15 months to ₹2,280 crore AUM, serving around 2.5 lakh active customers. Meanwhile, the Emerging Market LAP portfolio reached ₹3,581 crore, contributing 23% of total AUM, supported by network expansion to 317 branches across 13 states.
Operational efficiency also improved during the quarter. Ugro Capital undertook a cost realignment initiative expected to deliver ₹200–220 crore in annual savings. Reported return on assets (ROA) stood at 2.1%, while adjusted ROA (excluding one-time costs) improved to 2.8%, indicating progress toward long-term profitability targets.
Asset quality remained stable, with gross NPA at 2.5% and net NPA at 1.6%. Collection efficiency stayed strong at 98%, while the provision coverage ratio was maintained at 45%.
On the funding side, the cost of borrowing declined by 45 basis points YoY to 10.16%. Capital adequacy remained robust at 21.2%, ensuring sufficient headroom for growth without requiring fresh equity over the next three years.
The company also continued to strengthen its ESG positioning, with over 70% of borrowers being women and 17% of its AUM classified under green financing.
Overall, the Q4 results 2026 reflect Ugro Capital’s transition toward a more sustainable, high-yield, and annuity-driven business model, positioning it well for long-term growth in India’s MSME lending space.
| Metric | Q4 FY26 / FY26 | Growth / Change | Insight |
|---|---|---|---|
| Total Income | ₹2,021.1 Cr | 🔼 +40% YoY | Strong revenue momentum |
| Interest Income | — | 🔼 +43% YoY | Core lending growth driver |
| Net Profit (PAT) | ₹174.8 Cr | 🔼 +21% YoY | Healthy profitability |
| AUM | ₹15,334 Cr | 🔼 +28% YoY / 🔽 1% QoQ | Stable despite portfolio shift |
| ROA | 2.1% | — | Improved operational efficiency |
| Adjusted ROA | 2.8% | — | Excludes one-time costs |
| ROE | 7.1% | — | Moderate return profile |
| Adjusted ROE | 9.6% | — | Moving toward long-term targets |
| Cost Savings Target | ₹200–220 Cr | — | Efficiency-driven strategy |
| Segment / Metric | Q4 FY26 Data | Key Takeaway |
|---|---|---|
| Focus Verticals Share | 38% of AUM | Up from 32% in one quarter |
| Emerging Market LAP AUM | ₹3,581 Cr | 23% of total AUM |
| Embedded Finance AUM | ₹2,280 Cr | 6x growth in 15 months |
| Customer Base | ~2.5 Lakh | Rapid expansion |
| Branch Network | 317 branches | Expanded across 13 states |
| GNPA | 2.5% | Stable asset quality |
| NNPA | 1.6% | Controlled credit risk |
| Collection Efficiency | 98% | Strong recovery performance |
| Cost of Borrowing | 10.16% | 🔽 45 bps YoY |
| Capital Adequacy (CAR) | 21.2% | मजबूत balance sheet |
| Off-Book AUM | 38% | Shift to annuity income model |
| Women Borrowers | 70%+ | Strong ESG focus |
| Green Portfolio | 17% of AUM | Sustainable lending growth |
Source: https://www.bseindia.com/xml-data/corpfiling/AttachLive/ecbae8f0-f03d-410f-ab3f-fa1243d6dea1.pdf