Arohan Financial Services Limited | Annual Report 2022-23

| 72 Annual Report | 2022-2023 Directors’ Report which has an outstanding portfolio of approximately INR 31 Crores as on March 31, 2023. The newly created recovery vertical has helped in enhancing recovery along with minimizing the write-off provisions. The Company has witnessed one of the biggest funds raise in the MFI sector by augmenting a capital raise of about INR 430 Crores including funds from TIAA and FMO, which has helped in the sustained growth of the business throughout the year. In this regard, the Company has received approval from the RBI on March 23, 2023 pursuant to RBI Directions for change in capital structure and composition of the Board of the Company. The Company has reported Operational Revenue of about INR 1,069.45 Crores and net profit of INR 70.72 Crores. The Other Income of the Company grew by 15.19% in comparison with previous year. However, Net worth had increased from the previous financial year ended March 31, 2022 due to retained earnings and capital infusion, the net worth of the Company for the financial year stood at INR 1,338.03 Crores. Borrowings has increased to INR 4,535 Crores for the financial year ended March 31, 2023 in comparison to that of INR 4,127 Crores reported in the previous financial year ended March 31, 2022. The OPEX ratio of the Company was marginally increased year on year, primarily due to the base impact. The total comprehensive income (TCI) of the Company stood for the financial year 2022-23 at INR 68.09 Crores against a TCI of INR 59.32 Crores for the Financial Year 2021-22. In terms of gross AUM, the Company had grown from INR 4,122 Crores to INR 5,357 Crores. The major focus during the year was on disbursement, expansion, collection and recovery. As a key achievement, during the year under review, the Company won several noteworthy awards: • Microfinance Company of the Year’ Award at the 3rd ANNUAL BFSI TECHNOLOGY EXCELLENCE Awards programme, organised by Quantic; • Best Risk Management Initiatives Award by AMFI West Bengal; • AMFI Awards, 2023 for Technology Innovations; • Erstwhile Head of Human Resources, Admin, Training & CSR at Arohan has been awarded for “Outstanding contribution during COVID in motivating staff and client” at UPMA’s V th State Conference; • Two Modern Governance Top 100 Awards in the categories Boards & Governance Innovator and ESG, Diversity & Climate Trailblazer. The Company has received several noteworthy Certifications: • CARE MFI 1 Grading, highest on an 8-point scale; • COCA Assessment score of C1 (top grade) indicating “Excellent Performance on COCA Dimensions”; • Awarded an Alpha Grading and Rating Outlook as Positive in Social Rating under the CERISE SPI4 tool methodology by MCRIL; • Arohan's Information Security Management Systems get certified with ISO/IEC 27001:2013 by BSI; • Recertified with ISO 9001:2015 for Internal Audit; • Great Place to Work-Certified™. CHANGE IN THE NATURE OF BUSINESS During the year under review, there was no change in the nature of the business of the Company. CAPITAL INFUSION During the year, the Company has issued 1150 Secured, Rated, Listed, Redeemable, Transferable Non- Convertible Debentures at a coupon rate of 11.8647% at a face value of INR 10,00,000 each aggregating to INR 115 Crores on a private placement basis to Blue Orchard Microfinance Fund. Further during the year, the Company has allotted 10,00,000 Equity Shares to Arohan ESOP Trust on preferential basis and allotted 1,85,00,412 and 1,07,10,765 Cumulative Compulsory Convertible Preference Shares to Teachers Insurance And Annuity Association Of America (TIAA) and Nederlandse Financierings-Maatschappij Voor Ontwikkelingslanden N.V. (FMO) respectively on preferential basis.