Fusion Finance: ₹1,225 Cr Loss, ₹2,100 Cr Market Cap – MFI Math Be Like… WTF
At a Glance
Fusion Finance Ltd — the microfinance company that pulled off the rare combo of record revenues (₹2,320 Cr) and record losses (₹1,225 Cr) in FY25. With NPAs peaking at 12.58%, it’s the corporate equivalent of lending money to your drunk friend and expecting it back with interest.
Market cap still stands above ₹2,100 Cr. Why? Because investors love redemption arcs, apparently.
1. Introduction: Micro Loans, Macro Mayhem
Fusion was once a darling of microfinance bulls, boasting 26% revenue CAGR and top-tier operational scale. But by FY25, it had become a full-blown MFI horror story: losses ballooned, NPAs exploded, and ROE tanked to -55%.
This isn’t your typical “bad quarter” — this is a structural unraveling.
Yet, with a P/B of 1.51x, the stock still trades above its peers like it’s 2021 again.
Spoiler: It’s not.
2. Business Model – WTF Do They Even Do?
Fusion lends to women via the Joint Liability Group (JLG) model — 5–7 borrowers per group, mutually responsible for repayments.
Typical loans range from ₹25,000–₹60,000 with 14–28 day repayment cycles at 19%–23.4% interest.
Product line includes microloans, MSME loans, and productivity-linked items (mobiles, cycles).
The company also leverages distribution to cross-sell.
What’s not to love? Oh right — the 12.58% gross NPA and borrowers ghosting EMI schedules like Tinder matches.
3. Financials Overview
Source table
Metric (FY25)
Value
Revenue
₹2,320 Cr
Net Profit
-₹1,225 Cr
EBITDA
-₹1,170 Cr
Book Value
₹101
CMP
₹153
P/B
1.51x
ROE
-54.5%
ROCE
-2.96%
Net NPA
0.30% (post-writeoff?)
🧾 Verdict: They burned through equity like Diwali crackers and still trade at a premium. Legendary delusion.
