Arohan Financial Services Unlisted Shares Annual Reports

Arohan Financial Services Unlisted Shares

The Arohan Financial Services Limited Annual Report for 2022-2023 highlights the company's journey of “Navigating to Our Next,” emphasizing growth and transformation in the microfinance sector. Arohan, a digitally advanced NBFC-MFI regulated by the Reserve Bank of India, operates in 17 states, serving underserved households with financial inclusion products. **Key Performance Indicators:** * **Solvency & Liquidity:** Net worth is INR 1,338 Cr, with a capital adequacy ratio of 28.74%. Funds drawn amount to INR 4,195 Cr, and cash and cash equivalents are INR 935 Cr. * **Efficiency Ratios:** OPEX is 7.25%, and fee income constitutes 9% of total income. The credit rating is A- (Stable Outlook). * **Arohan Privilege Digital Lending:** 6,435 customers with a portfolio of INR 31 Cr. * **Impact Numbers:** 17 states, 252 districts, 829 branches, and a customer strength of 2.01 million. The rural branch percentage is 72%. Disbursement for FY23 is INR 5,299 Cr, and the gross loan portfolio is INR 5,357 Cr. Employee count: 8,030 with a 92.80% field employee percentage. * **Borrower Demography:** Rural 77%, Urban 23%, Women 98%. Arohan's Mission, Vision, and Values drive its operations. The mission is to empower underserved households with sustainable financial services. The vision includes impacting over 20 million lives by 2027, becoming a Top 3 MFI player, serving over 5 million households, and being a preferred employer. The core values emphasize employee engagement, transparency, honesty, integrity, innovation, customer centricity, and shareholder value focus. The company focuses on four Engines of Growth: Organic, Inorganic, Digital Lending (ArohanPrivilege), and Alliances & Acquisitions. It offers a range of credit and non-credit products and financial inclusion services including Saral, Bazaar, Micro Enterprise Loans, Term Life Insurance, Health Insurance and Dwelling Insurance. It emphasizes sustainable impact through a technology-enabled financial inclusion entity. **Financial Performance & Position:** Revenue for FY 2023 was INR 1,090.99 Cr, with profit after tax at INR 71 Cr and assets under management at INR 5,357 Cr. The company had a gross loan portfolio of INR 5,357 Cr, with a 2.8% GNPA and a 0.21% NNPA. It is rated CARE MFI 1, highest on an 8-point scale. It also carries a COCA Assessment score of C1, indicating “Excellent Performance." With a focus on expansion, Arohan is strategically deepening its footprint across India, especially targeting states demonstrating high degrees of financial exclusion. The Annual Report details recent awards and recognitions conferred on Arohan. They include a "Microfinance Company of the Year" award, a Best Risk Management Initiatives Award, and a Technology Innovations award. Several committees have been established. The board of directors consists of several committees that oversee and manage risks, audit functions, governance and sustainability. **Looking Ahead:** Arohan plans to impact 20 million lives by 2027, leveraging technology and financial inclusion. The company aims to be among the top 3 MFI players.

Arohan Financial Services Unlisted Shares

Arohan's Annual Report for 2021-2022, themed "Elements of the Future," focuses on maintaining sustainable business practices by prioritizing scalability, customer value, and digital advancements. It addresses challenges experienced globally and within the microfinance industry, emphasizing agility, innovation, and adaptation to customer needs. Arohan, as part of the Aavishkaar Group, highlights its commitment to serving key stakeholders with lasting value propositions, efficiency, and future-readiness. **Key Highlights of FY21-22** Arohan launched the "ApnaArohan" Customer App, a 360° mobile app providing loan information, cross-sale products including insurance, and online EMI payments in regional languages. Arohan was recognized as 'Microfinance Company of the Year' at the 3rd Annual BFSI Technology Excellence Awards 2022. The Company was recognized among the 'Top 25 Safest Workplaces in India' by KelpHR POSH Awards®. Accolades also included; "New Code of Work Awards 2021 in the Large Enterprise Category by PeopleStrong". Certifications include: Great Place to Work-Certified™ thrice in a row, and SMART Campaign Certification to award our client protection principle. **Chairman's Address** The Chairman's address acknowledges a year of opportunities and learning amidst pandemic-related challenges. The Reserve Bank of India's revised regulatory framework for Microfinance Loans in March 2022, is recognized as a significant advancement for the industry, shifting the onus of responsible lending onto the players. Arohan emphasizes digitization, transitioning to e-documentation and cashless repayment structures. The company invested in employee development and well-being, achieving Great Place to Work CertifiedTM status three times. Arohan attained a gender diversity ratio of 17% among its employee base by the end of March 2022. The Company decided not to proceed with the proposed IPO due to adverse market conditions, instead onboarding Piramal Alternatives with an INR 200 Cr infusion in March 2022. **Promoter's Address** The Promoter’s address highlights the long-term vision for Arohan to evolve into a new-age technology-enabled digital financial inclusion platform. Arohan is among the first Microfinance Institutions to receive approval from the Government of India to conduct Aadhaar-enabled eKYC. Additionally, the company intends to pilot a Green Loan Product to promote sustainable livelihoods. **Managing Director's Address** The Managing Director discusses SEBI approval for an IPO, Wave II of COVID-19, and the Resolution Package 2.0. The aftermath of the pandemic and accounting differences across banks made potential investors hold their decisions. The Assam Microfinance Incentive and Relief Scheme (AMFIRS) 2021 is recognized as the first of its kind. The central bank announced the new MFI Regulations in March 2022, a paradigm shift in norms. Arohan focuses on collections, ensuring borrowers receive needed credit, and adding to the management bench strength. The company has a full IT road map including a sector-first credit scoring model and an 'ApnaArohan' app for customers. Arohan is among the first NBFC-MFIs to receive approval to use Aadhaar for eKYC verification. Our five-year Vision plan of 20 by 2025 will need an additional year to make up for lost time during the pandemic. **Key Differentiators: Digitally Advanced and Strong ESG Focus** Arohan is committed to sustainable business practices through a well-knitted Environment, Social and Governance (ESG) model. They are guided by the elements of nature, which is the subtile power facilitator of progress and movement. Through its social and credit plus initiatives for its customers and communities, Arohan focuses on creating a triple bottom-line effect impacting people, planet and profit. Arohan offers various products, with emphasis on income generating loans and cashless disbursal through technology. The 'Elements of the Future' that the Company operates with are: Aakash (Space), Bhoomi (Earth), Vayu (Wind), Agni (Fire), and Jal (Water). Arohan recognized as a 'Microfinance Company of the Year' and recognized by MFIN for its progressive policies, with the intent to get its Assam portfolio back on track with AMFIRS 2021 initiative, as well as continuing to work on growth capital. They strive for gender equity, providing credit to the bottom line in efficient manner, microfinance can play a significant role in nation-building. **Financial Performance, FY21-22** Revenue: INR 92,043 Lakhs Gross Profits: INR 8,294 Lakhs Net Worth: INR 1,02,348 Lakhs Funds Drawn: INR 3,05,062 Lakhs Cash and Cash Equivalent: INR 95,363 Lakhs **Operational Highlights** Customer Strength: 18.64 Lakhs Branch: 740 Microfinance Branch Districts: 225 States: 14 Employee Strength: 7,160 Disbursement: INR 3,858.97 Crores Collection: INR 230.38 Crores **Mission & Core Values** The mission is to empower underserved households and small businesses sustainably. The vision is to impact over 20 million lives by 2025. Core values include employee engagement, transparency, honesty and integrity, innovation, customer centricity, and shareholder value focus. **Looking Ahead** FY2022-23 priorities include strengthening portfolio quality, enhancing operations in existing markets, and expanding into new states. A focus on digital lending, customer service, and potential capital raises is planned.