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AYE Finance Overview

1. Business Overview

AYE Finance Ltd. is an Indian Non-Banking Financial Company (NBFC) specializing in lending to the Micro, Small, and Medium Enterprise (MSME) sector. The company primarily focuses on providing credit to underserved small businesses that often lack access to formal credit from traditional banks. Its core business model involves leveraging technology and a "phygital" (physical + digital) approach to underwrite and disburse small-ticket business loans. AYE Finance makes money primarily through interest income generated from its loan portfolio.

2. Key Segments / Revenue Mix

The primary and almost exclusive segment for AYE Finance is MSME lending. Within this, the company offers various types of business loans tailored for working capital, machinery purchase, or other operational needs of small businesses. Revenue is predominantly derived from interest charged on these loans, supplemented by processing fees and other service charges. Specific product-wise revenue mix is not publicly available but the overarching focus is MSME credit.

3. Industry & Positioning

AYE Finance operates within India's dynamic and competitive financial services sector, specifically the NBFC and MSME lending segment. The MSME credit market in India is vast, highly fragmented, and significantly underpenetrated by traditional banks, creating a "missing middle" opportunity. AYE Finance positions itself as a tech-enabled lender filling this gap, serving businesses often overlooked due to a lack of formal credit history or collateral. It competes with other specialized NBFCs, fintech lenders, and to some extent, public and private sector banks expanding into small business lending.

4. Competitive Advantage (Moat)

AYE Finance's competitive advantages stem primarily from:

Niche Focus & Understanding: Deep understanding of the specific credit needs and risk profiles of informal and semi-formal MSMEs, allowing for tailored products.

Technology & Data Analytics: Utilization of proprietary credit assessment models and data analytics to underwrite borrowers with limited formal documentation, enabling faster and more efficient loan processing than traditional lenders.

"Phygital" Distribution Model: A blend of physical branches/presence in semi-urban and rural areas combined with digital processes for sourcing, underwriting, and servicing, provides effective reach and customer engagement.

Operational Efficiency: Streamlined processes to handle high volumes of small-ticket loans, which might be uneconomical for larger financial institutions.

5. Growth Drivers

Underpenetrated MSME Market: India's large and growing MSME sector has significant unmet credit demand, providing a substantial addressable market for AYE Finance.

Digital Adoption: Increasing digital literacy and adoption among small businesses facilitate easier data collection, credit assessment, and loan disbursement.

Financial Inclusion Push: Government and regulatory initiatives aimed at formalizing and financing MSMEs can boost demand for credit.

Geographic Expansion: Expanding its physical and digital footprint into new semi-urban and rural geographies across India.

Product Innovation: Introducing new credit products and services to cater to evolving MSME needs.

6. Risks

Asset Quality Risk: Lending to MSMEs, particularly those in the informal sector, inherently carries higher credit risk due to economic sensitivities, income volatility, and lack of formal financial records, potentially leading to higher Non-Performing Assets (NPAs).

Funding Risk: Reliance on diversified funding sources (banks, capital markets, development financial institutions). Any tightening in liquidity or increase in borrowing costs can impact profitability and growth.

Regulatory Risk: Changes in RBI regulations pertaining to NBFCs, such as capital adequacy norms, asset classification, provisioning, or fair practices, can significantly affect operations and profitability.

Competition: Intense competition from other NBFCs, fintech players, and expanding banks could put pressure on interest margins and market share.

Economic Downturn: MSMEs are highly susceptible to macroeconomic slowdowns, which can lead to reduced business activity and increased loan defaults.

7. Management & Ownership

AYE Finance is typically characterized by a professional management team with experience in financial services, technology, and operations, often backed by a strong board of directors. As a rapidly growing NBFC, its ownership structure includes significant stakes from institutional investors, including private equity and venture capital funds, alongside the founders. The company's strategy is guided by a focus on sustainable growth and robust risk management.

8. Outlook

AYE Finance operates in a fundamentally attractive market characterized by a large and underserved MSME segment in India. Its technology-driven and specialized approach positions it well to capitalize on this demand. The company's ability to maintain strong asset quality amidst aggressive growth, effectively manage funding costs, and adapt to the evolving regulatory landscape will be crucial. While the growth potential is significant, the inherent risks associated with lending to the informal sector and the competitive nature of the NBFC space require continuous focus on risk mitigation, operational efficiency, and capital management for sustainable long-term success.

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AYE Finance Key Financials

Market Cap ₹3416 Cr.

Stock P/E 19.9

P/B 1.3

Current Price ₹138.4

Book Value ₹ 102.6

Face Value 2

52W High ₹161.5

Dividend Yield 0%

52W Low ₹ 88.4

AYE Finance Share Price

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Volume
Price

AYE Finance Quarterly Price

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AYE Finance Peer Comparison

AYE Finance Quarterly Results

#(Fig in Cr.) Dec 2024 Mar 2025 Dec 2025 Mar 2026
Net Sales 361 409 443 528
Other Income 9 11 12 17
Total Income 370 420 455 545
Total Expenditure 219 240 253 292
Operating Profit 152 180 202 253
Interest 115 123 141 135
Depreciation 6 6 7 8
Exceptional Income / Expenses 0 0 0 0
Profit Before Tax 30 50 54 111
Provision for Tax 8 10 11 25
Profit After Tax 23 41 43 86
Adjustments 0 0 0 0
Profit After Adjustments 23 41 43 86
Adjusted Earnings Per Share 1.2 2.2 2.2 3.5

AYE Finance Profit & Loss

#(Fig in Cr.) Mar 2015 Mar 2016 Mar 2017 Mar 2018 Mar 2019 Mar 2020 Mar 2021 Mar 2022 Mar 2023 Mar 2024 Mar 2025 TTM
Net Sales 1 5 24 80 210 412 495 432 623 1040 1460 1741
Other Income 0 1 2 2 8 1 4 12 20 32 45 49
Total Income 1 6 26 82 218 413 499 443 643 1072 1505 1790
Total Expenditure 2 7 22 49 110 224 230 341 361 501 786 1004
Operating Profit -2 -1 4 33 108 189 269 102 282 571 719 787
Interest 0 2 11 30 73 141 236 160 199 329 472 514
Depreciation 0 0 0 1 2 8 9 10 11 15 22 27
Exceptional Income / Expenses 0 0 0 0 0 0 0 0 0 0 0 0
Profit Before Tax -2 -3 -7 2 32 40 23 -67 71 228 225 245
Provision for Tax -1 1 0 0 7 8 6 -16 28 56 54 54
Profit After Tax -1 -4 -7 2 25 32 17 -51 44 172 171 193
Adjustments 0 0 0 0 0 0 0 0 0 0 0 0
Profit After Adjustments -1 -4 -7 2 25 32 17 -51 44 172 171 193
Adjusted Earnings Per Share -0.4 -1.7 -3.4 1.1 11.7 15.2 7.9 -24 20.5 80.4 9.1 9.1

Growth Rates

# 1 Year 3 Year 5 Year 10 Year
Sales CAGR 40% 50% 29% 107%
Operating Profit CAGR 26% 92% 31% 0%
PAT CAGR -1% 0% 40% 0%
# 1 Year 3 Year 5 Year 10 Year
Share Price CAGR NA% NA% NA% NA%
ROE Average 12% 12% 6% -2%
ROCE Average 13% 12% 11% 5%

AYE Finance Balance Sheet

#(Fig in Cr.) Mar 2015 Mar 2016 Mar 2017 Mar 2018 Mar 2019 Mar 2020 Mar 2021 Mar 2022 Mar 2023 Mar 2024 Mar 2025
Shareholder's Funds 9 25 87 89 495 517 747 705 758 1236 1658
Minority's Interest 0 0 0 0 0 0 0 0 0 0 0
Borrowings 1 16 35 326 576 1375 1314 1506 2253 3494 2317
Other Non-Current Liabilities -1 1 1 4 5 -10 14 -1 18 10 -27
Total Current Liabilities 1 22 40 96 195 125 20 58 71 89 2329
Total Liabilities 11 64 163 515 1272 2006 2095 2268 3100 4829 6277
Fixed Assets 0 0 1 2 4 18 27 27 27 32 41
Other Non-Current Assets 2 14 54 235 514 9 2 11 11 18 5046
Total Current Assets 9 49 108 277 754 1979 2066 2230 3062 4779 1190
Total Assets 11 64 163 515 1272 2006 2095 2268 3100 4829 6277

AYE Finance Cash Flow

#(Fig in Cr.) Mar 2015 Mar 2016 Mar 2017 Mar 2018 Mar 2019 Mar 2020 Mar 2021 Mar 2022 Mar 2023 Mar 2024 Mar 2025
Opening Cash & Cash Equivalents 0 6 20 11 11 140 172 179 153 273 527
Cash Flow from Operating Activities -6 -31 -110 -262 -472 -520 125 -272 -720 -1323 -812
Cash Flow from Investing Activities -0 -8 -5 -41 -26 42 -190 46 78 83 -39
Cash Flow from Financing Activities 12 54 106 304 627 510 72 200 762 1494 1255
Net Cash Inflow / Outflow 5 14 -9 0 129 32 7 -27 120 254 405
Closing Cash & Cash Equivalent 6 20 11 11 140 172 179 153 273 527 931

AYE Finance Ratios

# Mar 2015 Mar 2016 Mar 2017 Mar 2018 Mar 2019 Mar 2020 Mar 2021 Mar 2022 Mar 2023 Mar 2024 Mar 2025
Earnings Per Share (Rs) -0.42 -1.69 -3.37 1.08 11.75 15.18 7.91 -24.05 20.54 80.39 9.06
CEPS(Rs) -0.39 -1.62 -3.14 1.48 12.84 18.87 12.26 -19.38 25.9 87.2 10.24
DPS(Rs) 0 0 0 0 0 0 0 0 0 0 0
Book NAV/Share(Rs) 3.06 6.7 35.18 36.2 220.97 229.38 333.99 312.68 334.61 551.84 86.12
Core EBITDA Margin(%) -314.33 -33.77 9.7 38.36 47.74 45.65 53.48 20.96 42.04 51.88 46.14
EBIT Margin(%) -312.1 -24.9 14.59 40.39 50.43 44.03 52.44 21.33 43.39 53.52 47.72
Pre Tax Margin(%) -316.54 -68.68 -29.37 2.89 15.42 9.7 4.7 -15.61 11.45 21.9 15.41
PAT Margin (%) -195.18 -81.06 -29.37 2.89 11.97 7.87 3.41 -11.89 7.03 16.5 11.73
Cash Profit Margin (%) -182.44 -77.53 -27.42 3.96 13.08 9.79 5.29 -9.58 8.87 17.9 13.25
ROA(%) -18.48 -10.96 -6.34 0.68 2.81 1.98 0.82 -2.35 1.63 4.33 3.08
ROE(%) -26.46 -34.64 -15.75 3.02 9.14 6.74 2.81 -7.44 6.35 18.14 12.21
ROCE(%) -28.82 -3.4 3.25 9.99 12.5 11.66 13.09 4.3 10.25 14.29 12.76
Receivable days 0 0 0 0 0 0 0 0 0 0 0
Inventory Days 0 0 0 0 0 0 0 0 0 0 0
Payable days 0 0 0 0 0 0 0 0 0 0 0
PER(x) 0 0 0 0 0 0 0 0 0 0 0
Price/Book(x) 0 0 0 0 0 0 0 0 0 0 0
Dividend Yield(%) 0 0 0 0 0 0 0 0 0 0 0
EV/Net Sales(x) 5.15 3.64 2.98 4.89 2.76 2.89 2.01 2.72 3.1 2.7 2.37
EV/Core EBITDA(x) -1.72 -17.02 17.99 11.78 5.36 6.28 3.71 11.5 6.85 4.92 4.81
Net Sales Growth(%) 0 874.65 385.91 225.76 162.85 96.43 20.29 -12.79 44.34 66.86 40.33
EBIT Growth(%) -157.93 22.23 384.62 802.07 228.12 71.52 43.26 -64.52 193.61 105.78 25.13
PAT Growth(%) -60.34 -304.78 -76.07 132.01 989.93 29.2 -47.89 -404.03 185.4 291.49 -0.24
EPS Growth(%) -187.19 -304.7 -99.18 131.99 990.35 29.22 -47.89 -403.96 185.4 291.49 -88.73
Debt/Equity(x) 0.16 1.83 0.81 4.49 1.43 2.71 1.78 2.19 3.1 2.88 2.78
Current Ratio(x) 7.45 2.19 2.68 2.9 3.86 15.89 101.62 38.45 42.89 53.68 0.51
Quick Ratio(x) 7.45 2.19 2.68 2.9 3.86 15.89 101.62 38.45 42.89 53.68 0.51
Interest Cover(x) -70.3 -0.57 0.33 1.08 1.44 1.28 1.1 0.58 1.36 1.69 1.48
Total Debt/Mcap(x) 0 0 0 0 0 0 0 0 0 0 0

AYE Finance Shareholding Pattern

# Dec 2025 Feb 2026 Mar 2026
Promoter 0 0 0
FII 0 19.04 18.66
DII 0 18.17 18.39
Public 0 62.79 62.95
Others 0 0 0
Total 0 100 100

AYE Finance News

AYE Finance Pros & Cons

Pros

  • Company has delivered good profit growth of 39% CAGR over last 5 years
  • Company has reduced debt.

Cons

    0
  • Promoter holding is low: 0%.
  • Company has a low return on equity of 12% over the last 3 years.
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