Fusion Microfinance shares plunge 20% to trade below IPO price after Q1 loss, high NPAs

With today’s slump, the stock has slipped below its Initial Public Offer (IPO) price of ₹368 apiece.

Fusion Microfinance posted a net loss of ₹35.62 crore in Q1FY25, compared to a profit of ₹120.46 crore in the same quarter of the preceding fiscal year. 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 Asset (GNPA) ratio grew 7,063 basis points(bps) to 5.46% from 3.2% in the corresponding quarter of the preceding fiscal year. Sequentially, the microfinance company’s GNPA ratio fell 889.3 bps from 2.89% in Q4FY24.

In Q1FY25, the microfinance institution’s Return On Assets (RoA) turned negative and stood at 1.19%, declining by 12,385 bps from 4.99% in Q1FY24.

The microfinance institution posted an increase of over 25% in its Assets Under Management (AUM) in Q1FY25 as it grew to ₹12,192.58 crore from ₹9,711.75 crore in Q1FY24.

On a quarter-on-quarter basis, the company’s AUM also increased by 6.24% from ₹11,476.08 crore in Q4FY24.

The company’s total income increased by nearly 28% YoY to ₹706.68 crore in Q1FY25 against ₹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% YoY to ₹396.55 crore compared to ₹294.07 crore in Q1FY24. Sequentially, NII increased 10% from ₹359.98 crore in Q4FY24.

In Q1 FY25, the company’s Net Interest Margin (NIM) also increased by 689 bps YoY to 11.64%, up from 10.89% in Q1 FY24. The NIM grew by 43 bps from 11.59% in the March quarter of FY24.

Fusion Microfinance’s disbursements increased by 30.73% YoY to ₹2,986.65 crore in Q1FY25 compared to ₹2,284.61 crore in Q1FY24. In Q1FY25, the company’s borrower base increased to 39.5 lakh. The company also opened 101 new branches, increasing the total branch network to 1,398.