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| Product | Quantum (Rs. Cr) | Long Term Rating | Short Term Rating |
| Bank Loan Ratings | 200.00 | ACUITE BBB | Stable | Upgraded | - |
| Total Outstanding | 200.00 | - | - |
| Total Withdrawn | 0.00 | - | - |
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Rating Rationale |
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Acuite has upgraded the long term rating of 'ACUITE BBB' (read as ACUITE triple B) from 'ACUITE BBB-' (read as ACUITE triple B minus) on the Rs 200.00 Cr. Bank loan facilities of Ahalia Finforex Limited (AFL). The outlook is 'Stable'.
Rationale for Rating Acuite, vide its press release 9th March, 2026, had reaffirmed and assigned the rating of AFL against which the issuer had appealed and provided further information and clarification, particularly with respect to asset quality. Upon receipt of further clarity on GNPA recovery from the vehicle and property loans segment. Acuite notes the improvements in the asset quality, with the GNPA declining to 3.87 percent as of February 2026, which has improved from 9MFY 26 with a GNPA at 4.17 percent. It is also noted that the provisioning for the year is not expected to impact profitability significantly. The company's networth stood at Rs 100.06 Cr as of February 2026 and further capital infusion from the promoters is expected in FY 2027. The Rating Upgrade factors in the improvement in company's asset quality and capital position of the company, which are expected to strengthen further with the expected capital infusion from the promoters in FY 2027.The rating continues to factor in support received from the promoter group which is Ahalia Group,followed by healthy growth in AUM from Rs 222.91 Cr. in FY 24 to Rs 284.94 Cr. in FY25 and Rs.351.30 Cr. for 9MFY2026. AFL is backed by the support from the promoters group; Ahalia Group and an experienced management team. Additionally, the company has seen an increase in networth from Rs 61.06 Cr. in FY 24 to Rs. 72.12 Cr. in FY25 and a networth of Rs 92.54 Cr. as of December 31, 2025. The company is expected to infuse equity of around Rs 15 Cr. in in Q4FY26 with a total debt which stood at Rs 237.24 Cr. for FY 25 and Rs 287.72 Cr. for 9MFY26 respectively. The company had a resulting debt/equity ratio of 3.29 times for FY25. However, the rating is constrained by moderation in asset quality, small scale of operations along with geographic concentration in the state of Kerala. The GNPA and NNPA increased from 3.92 percent and 2.76 percent respectively in FY 2024 to 4.38 % and 3.73 % for FY2025. The deterioration was primarily driven by slippages in the unsecured business loan and vehicle loan portfolios disbursed during the COVID period, with recoveries expected in the coming quarters. The equity infusion, while expected to strengthen the company’s capital position, will need to be supported by improved asset quality indicators. Going forward, the company’s ability to arrest further deterioration in asset quality while scaling operations will remain a key rating monitorable. |
| About the company |
| Ahalia Finforex Limited was incorporated in the year 2001 with its head office located in Kerela. The company was previously known as Ahalia Money Exchange and Financial Services Private Limited (AMEFSPL), whose constitution and name was changed to Ahalia Finforex Limited. It is engaged in extending credit facilities in the form of Gold Loans, Loans against Property, Vehicle Loans and Personal Loans. With the lending business, it also operates its traditional money exchange division which offers a range of services including remittances, foreign currency purchases and sale with AD – 2 license availed in FY24, also providing PAN card related services, Visa and Passport services and Travel Card services. Company managed by Mr. Rajesh Puthanveedu, Mr. Dinil Ramachandran Manayil, Mr. Vettikuzhiyil Sankaran Nair Bhuvanendran, Mr. Sriyani Kumuduni Rathnayaka Ekanayaka Mudiyanselage, Mr. Vazhoor Sreenivasan Gopalan and Mr. Kuriachen Kuriakose Padashery. |
| Unsupported Rating |
| Not Applicable |
| Analytical Approach |
| Acuité has considered standalone business and financial risk profile of Ahalia Finforex Limited to arrive at the rating. |
| Key Rating Drivers |
| Strength |
| Strong promoter support and management team
The company is well supported by the promoter group Ahalia Group which is headquartered in Abu Dhabi. The promoter is Dr. VS Gopal, Chairman of Ahalia Group who has over three decades of experience in General Medicine and has established Ahalia Group in the UAE and in the state of Kerala in India, mainly in the fields of healthcare, foreign exchange and education. The Managing director of Ahalia Finforex Limited is Mr N. Bhuvanendran has over two decades of experience in the financial sector. The promoters of Ahalia Group are also the directors in Ahalia FinForex Limited. Ahalia Finforex Limited additionally receives support by the means of equity infusions from the promoters.The promoters are expected to infuse around Rs 15 crore in Q4FY26, which is likely to support business growth and strengthen the capital structure. Healthy growth in AUM and earning profile The Company has seen healthy growth in AUM which grew to Rs. 351.3 Cr. as on Dec 31, 2025 and crossed Rs 400 Cr as of February 2026 as compared to Rs 284.94 Cr. as on March 31, 2025. Ahalia Finforex Limited's gold loan portfolio contributed ~67 percent of the total loan portfolio followed by the vehicle loan and property loans that together contributed ~13 percent of the loan portfolio for 9M FY 2026 as compared to FY 2025, where the gold loan portfolio contributed ~ 58 percent of the total loan portfolio followed by the vehicle and property loans that together contribute ~22 percent of the loan portfolio. The company has discontinued fresh disbursements in these segments of from the current fiscal year. The company made disbursements of Rs 1183.93 Cr. in 9MFY 2026 as against disbursements of Rs 618.98 Cr. in FY 2025. The company provides foreign exchange services as an Authorised Dealer Category-II Money changer which includes foreign currency exchanges and remittances. The Company is the sub-broker for Kotak Securities and provide services in equity brokering and mutual funds. The company’s earning profile indicated by the PAT stood at Rs 12.03 Cr. for 9MFY 26 and has increased from Rs 8.06 Cr. for FY 25. Acuité believes that going forward the ability of the company to maintain comfortable asset quality and growth momentum in AUM will be key rating sensitivity. |
| Weakness |
| Modest capital structure:
The company’s capital structure is marked by Networth of Rs. 92.54 Cr. as on Dec 31, 2025 which has improved to Rs 100.04 Cr. as of February 2026 as compared to Rs 72.12 Cr. as on March 31, 2025 and total debt of Rs. 287.72 Cr. for 9MFY26 as compared to Rs 237.24 Cr. for FY 25 resulting in a debt/equity ratio of 3.29 times and 3.11 times for 9MFY26. The equity infusion would help grow the loan book further and improve the gearing levels. Acuité believes that the company’s ability to manage its gearing levels will be a key monitorable and infusion of capital would be required for containing gearing levels and to support business growth. Moderate Asset Quality albeit improving The company has experienced moderation in its asset quality, indicated by the GNPA which stood at 4.17 percent for 9MFY 26 with the NNPA at 3.47 percent. For FY25, the GNPA stood at 4.38 percent and the NNPA for the same period stood at 3.73 percent respectively. The increase in NPA was from the vehicle loans and business loans disbursed during COVID, the recovery for which is expected by Q4FY26. The company previously followed 120+ DPD NPA recognition policy till FY25, which is transitioned to 90+ DPD for FY 26 onwards. The on time portfolio saw a reduction from 81.49 % in FY 24 to 78.81 in FY25 which saw improvements to 93.41% for 9MFY26 . As of February 2026, the company has reported a GNPA of 3.87 percent and NNPA of 3.25 percent from the recovery from the non-gold portfolio. The company's provisioning for the legacy portfolio as well for the year is not expected to impact profitability significantly.Going forward, the company’s ability to maintain its asset quality and provisioning requirements while growing profitably will remain a key rating monitorable. Geographical concentration risk: AFL is a limited company and a subsidiary of Ahalia Group which started business in India in the state of Kerala. The Company obtained their FFMC license in 2001 and further forayed in the lending business after it obtained the NBFC license in 2011 and have been operating in the state for over two decades. Through its lending business, the company’s AUM grew from Rs 222.91 Cr. in FY2024 to Rs 351.30 Cr. in 9MFY2026 (Rs. 284.94 Cr. in FY25). The company has a modest scale of operations with its operations confined to the state of Kerala. It has a branch network of 59 branches across 12 districts in the state. Occurrence of events such as slowdown in economic activity or shifting of activity to other geographies could impact the cash flows of the borrowers, thereby impacting credit profile of AFL’s borrowers. The operations will remain confined to the state of Kerala over the medium term. Going forward, Acuité believes that geographical concentration will continue to weigh on the company’s credit profile. |
Rating Sensitivity
| Potential triggers (individual or collective) for an upward rating action: |
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| Potential triggers (individual or collective) for a downward rating action: |
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| Liquidity Position |
| Adequate |
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AFL’s overall liquidity profile remains adequate with no negative cumulative mismatches in near to medium term as per ALM dated December 31,2025. Ahalia Finforex has encumbered a Cash and cash equivalents (inclusive of foreign currency) is Rs.33.91 Cr. as on December 31, 2025. The company has debt repayments of Rs 201.19 Cr. as against collections from advances of Rs 292.19 Cr. over the next three year period from December 31, 2025.
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| Outlook: Stable |
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| Other Factors affecting Rating |
| None |
| Key Financials - Standalone / Originator | ||||||||||||||||||||||||||||||||||||||||
*Total income equals to Net interest income plus other income **Total assets adjusted to Deferred Tax assets |
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| Status of non-cooperation with previous CRA (if applicable): |
| Not Applicable |
| Any other information |
| None |
| Applicable Criteria |
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• Application Of Financial Ratios And Adjustments: https://www.acuite.in/view-rating-criteria-53.htm • Default Recognition: https://www.acuite.in/view-rating-criteria-52.htm • Non-Banking Financing Entities: https://www.acuite.in/view-rating-criteria-44.htm |
| Note on complexity levels of the rated instrument |
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