SRG Fingrow Finance: A 5-Year Review of Financial Performance

Introduction to SRG Fingrow Finance

SRG Fingrow Finance Limited, formerly known as S R G Securities Finance Limited, is a Non-Banking Financial Company (NBFC) registered with the Reserve Bank of India since 1995. Based in Udaipur, Rajasthan, the company operates within the financial services sector, specializing in providing vehicle finance, construction and mining equipment financing, and business loans. As a nano-cap company with a market capitalization of approximately ₹15.3 crore, its performance offers insights into the dynamics of smaller players in India's competitive NBFC landscape. This article provides a detailed examination of its financial results over the last five fiscal years, from March 2021 to March 2025.

Revenue and Profitability Trends

A review of SRG Fingrow Finance's financials reveals a consistent downward trend in its top-line revenue. In the fiscal year ending March 2021, the company reported revenue of ₹3.12 crore. This figure has steadily decreased over the subsequent years, falling to ₹2.1 crore in 2022, ₹1.81 crore in 2023, ₹1.44 crore in 2024, and further down to ₹1.3 crore in 2025. This continuous decline in revenue points to significant operational or market-related challenges, such as increased competition or a strategic shift in its loan portfolio.

Similarly, the company's net profit has also seen a general decline, though with some fluctuation. Net income stood at ₹0.51 crore in 2021 and dropped to ₹0.39 crore in 2022. It saw a brief recovery to ₹0.52 crore in 2023 before resuming its downward trajectory to ₹0.47 crore in 2024 and ₹0.35 crore in 2025. The declining profitability, in line with falling revenues, raises questions about the company's long-term growth sustainability.

Analysis of Margins and Efficiency

Despite the falling revenue, SRG Fingrow's net profit margin has shown an interesting pattern. The margin improved from 16.34% in 2021 to a peak of 32.63% in 2024, before settling at 26.92% in 2025. This suggests that while the company's overall business volume has shrunk, it may have improved its operational efficiency or focused on higher-margin loan products during this period. The improvement in margins indicates effective cost management relative to its declining scale. However, the dip in the most recent fiscal year suggests that maintaining these high margins is becoming challenging.

Financial Health: Debt and Equity

One of the most significant positive developments for SRG Fingrow Finance is the strengthening of its balance sheet through deleveraging. The company's total debt-to-equity ratio has seen a dramatic reduction over the past five years. From a moderate 0.71 in 2021, the ratio was brought down to 0.12 by 2023 and eventually reached 0.0 in the fiscal year 2024. This move towards becoming a debt-free entity reduces financial risk and interest expenses, contributing positively to its bottom line. This conservative capital structure is a key strength, especially for a small company navigating a volatile economic environment. The Return on Equity (ROE) has remained modest, fluctuating between 2.95% and 4.03% over the period, reflecting the challenges in generating substantial returns for shareholders amidst declining operations.

Financial Performance Summary (2021-2025)

Market Position and Stock Performance

SRG Fingrow Finance is listed on the BSE under the code 536710. As of August 2025, its share price was approximately ₹28.50. The stock has traded in a 52-week range between ₹25.60 and ₹38.47. With a market capitalization of ₹15.3 crore, it is firmly in the nano-cap category. Its price-to-earnings (P/E) ratio stands at a high 43.85, which appears elevated when considering the declining earnings trend. This high valuation could suggest market optimism about a future turnaround or could be a sign of overvaluation relative to its fundamentals. The company's peer group includes other small NBFCs, and its market cap is around the median for its competitors.

Business Operations and Management

The company is managed by a board that includes Vinod K Jain as Managing Director and Seema Jain as Whole Time Director. Its core business involves scrutinizing loan proposals for vehicles and equipment, evaluating security, and disbursing loans after due diligence. The process includes involving a guarantor to mitigate default risk. The interest rates are determined based on the applicant's profile, repayment capacity, and the value of the underlying asset. This traditional approach to lending is common among smaller NBFCs focused on specific regional markets.

Conclusion

SRG Fingrow Finance presents a mixed financial picture. While the company has successfully strengthened its balance sheet by becoming virtually debt-free, it faces persistent challenges with declining revenue and profits. The improved profit margins in recent years offer a silver lining, suggesting better operational control. However, the combination of a shrinking top line and a high P/E ratio warrants caution from investors. The company's future will depend on its ability to reverse the revenue decline and find new avenues for growth in the competitive NBFC sector without compromising its now-conservative financial structure.