| Established track record of operations
The Andhra Bank farmers’ service co-operative society (ABFSCS) is a co-operative society incorporated in 1982 with amalgamation of eight PACS (Primary agricultural co operative societies) at Tekulapally, Khammam district, Telangana with aim to provide banking services to 19 villages across 4 mandalas in Khammam district, Telangana. ABFSCS is a fourth largest society in Telangana and largest in Khammam district. The society consists of 13 board of directors including chairmen, vice chairmen and other directors who are elected by members through cooperative society elections. Managing director of the society is deputed from Union bank of India (UBI). Society is confined to 19 villages; all the members of the society are people living in villages and society offers services exclusively to people of 19 villages. The society is engaged in credit, trading of fertilizers activities and undertakes paddy and maize procurements on behalf of Telangana state civil supplies department. The society primarily provides agricultural loans for cultivation of cotton, maize, paddy, chillies etc, gold loans by pledge of ornaments and agricultural term loans to its members. Other services offered by society includes Accepting deposits, locker facility to its members, providing group insurance scheme to members and other banking services.
Acuite believes that society will continue to reap benefits from its established presence in the region.
Growing loan portfolio and membership base
The society’s loan portfolio comprises crop loans, gold loans, and term loans, each showing steady growth over the period. The overall loan portfolio stood at Rs.53.15 Cr. as on March 31, 2025 compared to Rs.50.37 Cr. as on March 31, 2024. The society maintains adequate capital adequacy, with a CRAR of 25.23%, providing a comfortable cushion against credit risk. Its net worth remains stable, supported by a steady capital base and modest accretion over the period.
Range of financial services
The society offers crop loans, gold loans, and agricultural term loans, alongside deposit mobilization, locker facilities, and group insurance schemes, thereby addressing varied financial needs of its member base.
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| Small scale of operations and regional concentration
The society’s operations remain relatively small in scale compared to larger co-operative institutions, with activities confined to 19 villages across four mandals in Khammam district. This geographic concentration limits diversification and exposes the society to region-specific risks, particularly in agriculture-dependent areas.
Moderate profitability and earnings profile
While interest income has grown steadily, profitability remains modest. PAT declined to Rs.0.14 Cr in FY25 from Rs.0.78 Cr in FY24, reflecting pressure from higher operating expenses and credit costs. Key return ratios such as RoAA and ROTA also moderated in FY25, underscoring the society’s limited earnings capacity.
Limited financial flexibility
The society’s funding profile is largely dependent on borrowings, which stood at Rs.50.19 Cr in FY25 against Rs.46.28 Cr in FY24, resulting in a debt-to-equity ratio of 2.93 times in FY25. This reliance on external borrowings, coupled with modest reserves and surplus, constrains overall financial flexibility and the ability to absorb shocks.
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