How has been the historical performance of Niyogin Fintech?

Revenue Growth and Operating Performance

Over the six-year period ending March 2025, Niyogin Fintech's net sales increased more than tenfold, rising from ₹27.91 crores in FY20 to ₹303.98 crores in FY25. This rapid expansion underscores the company's ability to scale its operations and capture market opportunities within the fintech sector. However, the absence of other operating income throughout this period indicates that revenue growth has been solely reliant on core business activities.

Despite the robust revenue growth, the company has struggled to convert sales into operating profits. Operating profit before depreciation and interest (PBDIT) excluding other income remained negative every year, though the margin of loss narrowed from a steep -73.09% in FY20 to a more moderate -1.75% in FY25. Including other income, operating profit improved but still remained negative, with a marginal loss of ₹0.29 crores in FY25 compared to a loss of ₹13.37 crores in FY24.

Profitability and Margins

The company has consistently reported net losses, with consolidated net profit after minority interest remaining negative throughout the period. The net loss narrowed from ₹23.91 crores in FY20 to ₹15.89 crores in FY25, reflecting some improvement but continued unprofitability. Earnings per share (EPS) followed a similar trend, improving from a loss of ₹2.78 per share in FY20 to ₹1.43 per share in FY25, though still negative.

Profit margins have been under pressure, with the PAT margin improving from a deeply negative -87.85% in FY20 to -5.37% in FY25. The gross profit margin also showed improvement but remained negative at -4.18% in FY25, indicating that costs continue to outpace revenues despite growth.

Cost Structure and Expenditure

Operating expenses have increased substantially in line with revenue growth. Manufacturing expenses surged from zero in FY20 to ₹138.92 crores in FY25, while employee costs rose steadily from ₹18.43 crores to ₹47.51 crores over the same period. Other expenses also increased significantly, reaching ₹98.01 crores in FY25. The purchase of finished goods fluctuated but showed a notable rise to ₹26.28 crores in FY25. These rising costs have contributed to the persistent operating losses despite higher sales.

Balance Sheet and Financial Position

Niyogin Fintech's total assets grew from ₹250.38 crores in FY20 to ₹564.32 crores in FY25, reflecting investments in fixed assets and working capital. Shareholder's funds increased from ₹241.40 crores to ₹322.92 crores, supported by equity capital infusion and reserves. The company has maintained a debt-free position in terms of long-term borrowings but has seen a rise in short-term borrowings from negligible levels to ₹96.04 crores in FY25, indicating increased reliance on short-term financing.

Cash and bank balances remained healthy, fluctuating between ₹45.82 crores in FY20 and ₹114.18 crores in FY25, supported by financing activities. However, net current assets turned negative in FY25 at -₹86.87 crores, signalling potential liquidity pressures despite the cash reserves.

Cash Flow Trends

Cash flow from operating activities has been negative in recent years, with a cash outflow of ₹86 crores in FY25, reflecting ongoing operational challenges. Investing activities also showed outflows in FY25, while financing activities provided inflows of ₹91 crores, indicating dependence on external funding to support operations and growth. The net cash inflow/outflow was marginally negative at ₹3 crores in FY25, following a positive inflow in FY24.

Overall, the cash position remains stable with closing cash and cash equivalents at ₹74 crores in FY25, though the negative operating cash flow highlights the need for improved operational efficiency and profitability.

Outlook and Considerations

Niyogin Fintech's historical performance reflects a company in growth mode, expanding its revenue base rapidly but yet to achieve sustainable profitability. The steady increase in expenses and operating losses suggests that the company is investing heavily in scaling its business, which may translate into future gains if cost controls and revenue quality improve. Investors should weigh the growth potential against the persistent losses and monitor the company's ability to manage working capital and reduce reliance on short-term borrowings.

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