ICRA

B2B fintech unicorn Oxyzo Financial Services recorded 58.4% year-on-year growth during the fiscal year ended March 2024. At the same time, the profits of the Tiger Global-backed company spiked 47% and neared the Rs 300 crore threshold. Oxyzo’s revenue from operations increased to Rs 903 crore in FY24 from Rs 570 crore in FY23. Oxyzo is the lending arm of industrial goods and services procurement platform OfBusiness which provides credit solutions and loans to small and medium enterprises (SMEs) and startups. Interest received from the disbursement of loans formed 96% of the total operating revenue which increased 61.3% to Rs 866 crore in FY24. The rest of the income came from fees and commissions which grew 50% to Rs 36 crore in FY24. Finance cost became the largest cost centre for Oxyzo, forming 61.67% of its overall expenditure. These expenses surged 73.2% to Rs 317 crore in FY24.

Oxyzo posts Rs 903 Cr revenue and Rs 291 Cr PAT in FY24

While the company has managed to grow the loan book and maintain a high share of secured loans, the target borrower segment has existing borrowing relationships. Hence, the risk of high competition from banks and/or the replication of the lending model by other NBFCs cannot be ruled out.



The issuer has made timely interest payments.

Ruchi Kalra, Chief Executive Officer

Oxyzo’s lending operations are of a relatively recent vintage and its ability to manage the asset quality through multiple economic cycles would remain a key monitorable.  A  high proportion of the portfolio is secured with good asset quality since the commencement of operation.


Oxyzo’s profitability trajectory has been supported by stable net interest margins), lower operating expenses/average managed assets , and stable credit costs/AMA). Oxyzo reported a profit after tax (PAT) of Rs. 135 crore in H1 FY2024 with a return on average assets (RoA) of 4.5% compared to Rs. 197 crore and 4.4%, respectively, in FY2023.


The company has been expanding its lender base and has developed relationships with more than 40 lenders comprising 27 banks , NBFCs and other lending institutions. It has also diversified its borrowing mix to include market instruments like non-convertible debentures (NCDs) and market linked debentures .



Security Name: 9.75% OXYZO Financial Services Limited 18 Feb 2027

ISIN: INE04VS07362

A+ /Stable

ICRA

Senior

Secured

OXYZO Financial Services Limited

Oxyzo posts Rs 903 Cr revenue and Rs 291 Cr PAT in FY24

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