Avanse Financial Services Reports Remarkable 73% Surge in Profit to Rs 38 Crore for FY21; Loan Disbursement Slips
In a significant development, Avanse Financial Services, a leading non-banking lender focusing on education, has announced a staggering 73% surge in its Profit After Tax (PAT), reaching Rs 38 crore for the financial year ending March 2021. This marks a substantial increase from the previous fiscal year, where Avanse recorded a PAT of Rs 22 crore.
However, amidst this profit surge, there’s a notable downturn in loan disbursal, declining by 8.2% to Rs 976 crore during FY21, compared to Rs 1,063 crore in the preceding year.
Attributing this slight dip in disbursal figures to the pervasive impact of the COVID-19 pandemic on educational delivery methods, Avanse Financial Services stated on Thursday that there’s a marginal effect on the disbursal statistics.
Reflecting on the challenges faced during the past year, Amit Gainda, CEO of Avanse Financial Services, remarked, “FY21 was a year fraught with challenges. Nonetheless, our organization witnessed a remarkable growth in PAT compared to FY20, with the figure standing at approximately Rs 38 crore. Furthermore, our total loan disbursed for the year amounted to nearly Rs 976 crore, contributing significantly to our net worth of Rs 942 crore.”
During FY21, the non-banking finance entity managed to amass an impressive Asset Under Management (AUM) of nearly Rs 3,103 crore, serving a diverse clientele of over 52,000 active customers.
Gainda emphasized the transformative nature of the education sector, accelerated by digital interventions, stating, “The educational landscape underwent a significant transformation, propelling digital initiatives at an unprecedented pace. Leveraging our student-centric products, we extended financial support to over 52,000 active customers, ensuring a seamless experience throughout.”
In terms of funding, Avanse Financial revealed that it successfully secured a total of Rs 250 crore through various government initiatives during the fiscal year. Of this amount, Rs 100 crore was raised through the Targeted Long-Term Repo Operation (TLTRO) 2.0, facilitated by the RBI through public sector banks. The remaining Rs 150 crore was acquired under the Partial Credit Guarantee (PCG) scheme.
Additionally, the company disclosed that it procured approximately USD 15 million from World Business Capital Inc, with backing from the US International Development Finance Corporation through external commercial borrowing (ECB).
These funds were allocated towards supporting deserving Indian students in pursuing their educational aspirations and fostering the development of the broader education ecosystem, Avanse Financial stated.
Highlighting its global outreach, Avanse Financial revealed that it fulfilled the educational funding requirements of approximately 1.2 lakh academic aspirants across 12,000 institutes and courses spanning 50 countries. Furthermore, the company extended growth and working capital assistance to nearly 1,000 educational institutions, benefiting over 5-6 lakh students.
Avanse Financial is primarily owned by Warburg Pincus, a prominent global private equity firm, holding an 80% equity stake, while the International Finance Corporation (IFC), a subsidiary of the World Bank, maintains a 20% equity stake in the company.