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| Product | Quantum (Rs. Cr) (SEBI) | Quantum (Rs. Cr) (Other FSR) | Long Term Rating | Short Term Rating | Regulated By |
| Bank Loan Ratings | 0.00 | 450.00 | ACUITE A+ | Stable | Reaffirmed | - | RBI |
| Total Outstanding | 0.00 | 450.00 | - | - | - |
| Total Withdrawn | 0.00 | 0.00 | - | - | - |
| Note:- For activities or ratings of instruments falling under the purview of Financial Sector Regulators other than SEBI, the grievance / dispute redressal mechanisms and investor protection mechanisms provided by SEBI shall not be available. |
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Rating Rationale |
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Acuité has reaffirmed the long-term rating of 'ACUITE A+' (read as ACUITE A Plus) on Rs. 450.00 Cr. bank facilities of APAC Financial Services Private Limited (APAC). The outlook is ‘Stable’.
Rationale for the rating The rating continues to factor in the sustained increase in scale of operations with improvement in earning profile and the healthy capitalization levels in FY26 and Q1FY27. APAC's AUM grew ~ 14 % to Rs. 2405.85 Cr. as on March 31, 2026 from Rs. 2108.21 Cr. as on March 31, 2025. The AUM for Q1FY27 stood at Rs 2479.98 Cr.The earning profile also saw an improvement with PAT levels at Rs. 126.93 Cr. for FY 26 as compared to Rs. 110.03 Cr. for FY 25. The company further reported a PAT of Rs. 38.12 Cr. for Q1FY27. The asset quality saw some deterioration in the GNPA and NNPA levels at 2.53 % and 1.31% as on March 31, 2026 as against 1.17% and 0.69% as on March 31, 2025 respectively. The GNPA and NNPA levels as on June 30, 2026 stood at 2.72% and 1.43% respectively. The deterioration seen was primarily due to stress in the MFI sector, borrower overleveraging, and the seasoning of the Micro LAP portfolio The rating continues to factor in the experienced management team supported by presence of seasoned investors/funds. The rating continues to factor in comfortable gearing levels of APAC at 1.15 times as on March 31,2026 as against 1.17 times as on March 31,2025. The rating further factors in the comfortable liquidity profile for the medium term and the increase in the granularity of portfolio through a planned expansion of APAC branches within the chosen geographies. The rating, however, continues to be constrained by asset quality of the loan book and seasoning of retail portfolio. Acuité believes that the ability of the company to deploy the funds across various asset classes while maintaining an optimal risk return trade-off and maintain asset quality will remain key monitorable. |
| About the company |
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Mumbai based, APAC started business operations in 2018 with the vision of servicing the financial needs of underbanked and underserved micro enterprises, self-employed and salaried in semi-urban and rural areas in Bharat. The Company’s business model is built on strong ESG principles with balance amongst its core mantras of G.Q.P. (Growth, Quality & Profitability). The Company's loan portfolio comprises primarily of term loans, secured by property.
APAC primarily serves borrowers who typically have limited access to banks or large financial institutions. The Company employees 2300+ people across 225+ branches in 7 states, and sources majority of its customers via an in-house sales team, which is additionally powered by the Company’s proprietary origination & underwriting technology platform “Alpha.” This feet-on-street business model helps APAC build strong relationships with customers, understand each customer’s unique financial needs and enables on ground verification of the collateral; while technology helps to improve efficiency and customer TATs. On ground presence of Company's employees across each of its 225+ branches for loan origination and collection also strengthens Company's fair practice w.r.t. its customers. APAC’s loans are primarily secured against property with an average ticket size on disbursement of 6 lakhs per borrower in FY2026 and ~Rs 6.4 lakh in Q1FY2027. APAC conducts thorough underwriting based on the borrower's assessed income, credit history, business vintage, collateral value and reference checks, among other aspects. The Company is deepening its use of technology and alternate data to improve the quality of its credit approval processes. Credit underwriting is as per board approved credit risk policy and related policies & programs. APAC has strong risk management systems, processes, policies and reviews, with a high degree of independent oversight through its Board of Directors which has experienced independent directors. Senior management has deep domain expertise and experience (semi-urban/rural and MSMEs) across business cycles. The risk team is further supported by the fraud control unit (FCU), to build a robust credit platform. By focusing on these aspects as being core to its business model, APAC effectively serves its customer target market with a strong product-market fit, maintains strong financial health (G.Q.P.), and contributes to the broader financial inclusion in India. |
| Unsupported Rating |
| Not Applicable |
| Analytical Approach |
| Acuite has considered a standalone approach to the business and the financial profile of APAC Financial Services Private Limited to arrive at the rating. |
| Key Rating Drivers |
| Strength |
| Seasoned Management Team supported by reputed investors:
As on June 30, 2026, Mr. Gunit Chadha, the founder promoter, held 41.71% of the stake in APAC. Multiples Private Equity Gift Fund (Previously Multiples Private Equity Fund & Plenty Private Equity Fund collectively) holds 20.04% in APAC and investors such as Norwest Capital LLC and Rajamahendra Chola Limited both own 16.40% each as on June 30, 2026. APAC's board of directors comprises of Mr. Gunit Chadha who has occupied top positions such as CEO of Deutsche Bank (Asia Pacific region) and CEO of IDBI Bank, Ms. Nithya Easwaran, (who has over two decades experience in financial services and is also the Managing Director of Multiples Alternate Asset Management Company Limited, Mr. Sankar Shastri, Mr. Sanjay Maliah, Mr. Ajit Raikar, Mr. Phani Shankar all having more than two decades of experience in BFSI and other industries and Mr. Robin Agarwal having over a decade of experience across Private Equity and Consulting. Comfortable Capitalization Profile and improved profitability metrics APAC's gearing levels are low at 1.15 times as on March 31, 2026 (1.17 times as on March 31,2025). The CRAR on levels stood at 40.80% as on March 31, 2026. ( CRAR for June 30, 2026 stood at 39.65% ). The networth stood at Rs. 1211.31 Cr. as on March 31,2026 (Rs. 1079.55 Cr. as on March 31,2025), while the outstanding debt stood at Rs. 1392.39 Cr. as on March 31,2026 (Rs. 1268.19 Cr. as on March 31,2025). The PAT for FY25 stood at Rs. 110.03 Cr. which grew to Rs. 126.93 Cr. in FY26 and further reported a PAT of Rs. 38.12 Cr. for Q1FY27. The RoAA and NIM for FY 26 stood at 5.11% and 15.43% respectively as against 5.01% and 14.53% for FY25. Acuité believes that APAC will continue to benefit from its experienced management and continued support from its investors. |
| Weakness |
| Limited seasoning of the new portfolio and risk inherent to MSME Sector:
The portfolio grew by ~14% Y-o-Y and healthy disbursements of Rs 796.74 Cr. were done in FY2026. APAC's AUM stands at Rs. 2479.98 Cr. as on June 30, 2026 as compared to Rs. 2405.85 Cr. as on March 31, 2026 and Rs 2108.21 Cr. as on March 31,2025. The company has recently introduced the Small LAP segment, with ticket sizes ranging from Rs. 15-75 lakh (average ~Rs. 20 lakh), compared to Rs. 3.5-35 lakh for the existing Micro LAP product. The company plans to scale up its Small LAP portfolio in a measured manner, increasing its share in the overall AUM to nearly 10% over time, with Micro LAP being the key contributor to the overall portfolio.APAC is fairly diversified with presence in 7 states with major focus on business loan segment which extends credit to micro enterprises, self-employed and salaried in semi-urban and rural areas which are secured in nature. 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 APAC. Acuité believes that the company’s ability to maintain its asset quality given the low seasoned loan book, macro environment and increased presence in the newer geographies will remain a key rating monitorables. Moderate asset quality metrics The company's asset quality has moderated over the past few years, with GNPA and NNPA increasing to 2.53% and 1.31%, respectively, as on March 31, 2026, from 1.17% and 0.69% as on March 31, 2025. The trend persisted in Q1FY27, with GNPA and NNPA further rising to 2.72% and 1.43%, respectively. The deterioration is attributable to portfolio seasoning, particularly in the Micro LAP segment, coupled with the residual impact of stress in the microfinance sector.However, majority of the portfolio is secured by the self-occupied residential property (over 95%), with overall credit cost less than 2%. Going forward, Acuite believes that any change in the asset quality levels and credit cost would be key monitorables. |
| ESG Factors Relevant for Rating |
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APAC has significant Institutional ownership with policies and processes in place to ensure transparent, fair & ethical conduct with its Customers and other stakeholders. Empowerment, Innovation & Excellence, Governance, Respect & Integrity and Collaboration are part of APAC’s core values. APAC has two independent directors in its Board & constituted board committees such as Risk Management Committee, Audit Committee, Nomination and Remuneration Committee, IT Strategy Committee and CSR Committee to ensure high governance standards.
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Rating Sensitivity
| Potential triggers (individual or collective) for an upward rating action: |
| Significant scale up in AUM backed by strong disbursement growth Healthy capital position and profitability metrics, while maintaining the asset quality Diversification of the funding profile |
| Potential triggers (individual or collective) for a downward rating action: |
| Material deterioration in asset quality, reflected in GNPA of 5 percent on a sustained basis Significant rise in gearing levels and/or weakening of liquidity buffers |
| Liquidity Position |
| Adequate |
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APAC’s liquidity profile remains adequate with positive cumulative mismatches in all the buckets up to 5 years as per ALM dated June 30, 2026. The company had borrowings outstanding of Rs.1,392.39 crore as on March 31, 2026 and Rs.1443.36 Cr. as on June 30, 2026. It had cash and bank balance of Rs. 34.18 crore and liquid investments in the form of mutual funds, CP , Deposits and NCD’s of Rs.214.66 crore as on June 30,2026. The monthly collection efficiency from the portfolio provides additional comfort. The company has debt repayments of Rs 437.37 Cr. for a period of one year from June 30, 2026 and expected inflows from advances and liquid investments of Rs 581.69 Cr. for the same period.
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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 |
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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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| Note:- For activities or ratings of instruments falling under the purview of Financial Sector Regulators other than SEBI, the grievance / dispute redressal mechanisms and investor protection mechanisms provided by SEBI shall not be available. |
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Contacts |
List of instruments and names of regulators of the instruments |
