Incred Capital Annual Report, Balance Sheet & Financials

 

Incred Capital Financial Services Private Limited Balance Sheet (Rs in Lakhs)

Particulars	31-03-2023	31-03-2022
ASSETS
Financial assets
Cash and cash equivalents	1,862.22	4,067.09
Derivative financial instruments	986.98	-
Trade receivables	2,780.49	1,425.22
Loans	12,665.29	27,924.90
Investments	25,002.77	2,826.93
Other financial assets	6,515.12	102.4
Non-financial assets
Current tax assets (Net)	1,153.67	439.7
Deferred tax assets (Net)	4,909.20	607.68
Property, plant and equipment	1,292.61	450.11
Capital work in Progress	28.11	1.09
Intangible assets under development	11.34	-
Goodwill	1,363.84	-
Other intangible assets	5,203.70	0.78
Other non-financial assets	432.62	3,720.90
Total Assets	64,207.96	41,566.80
LIABILITIES AND EQUITY
Financial liabilities
Derivative financial instruments	7,861.47	-
total outstanding dues of creditors other than micro and small enterprises	902.5	2,559.50
Debt Securities	5,249.25	-
Deposits	47.19	15.44
Other financial liabilities	3,213.36	1,050.22
Non-financial liabilities
Provisions	218.68	17.86
Other non-financial liabilities	262.36	365.45
Equity
Equity share capital	1,321.14	989.98
Other equity	45,132.01	36,568.35
Total Liabilities and Equity	64,207.96	41,566.80

Incred Capital Financial Services Private Limited Profit & Loss Statement (Rs in Lakhs)

Particulars	31-03-2023	31-03-2022
Interest income	1,030.66	2,313.57
Fees and commission income	9,944.17	2,005.28
Net gain on fair value changes	5,173.69	7,240.43
Other income	223.1	286.76
Total income	16,371.62	11,846.04
Finance costs	654.94	229.25
Impairment on financial instruments	-67.22	75.71
Employee benefits expenses	15,038.00	3,397.65
Depreciation, amortization and impairment	1,008.15	152.6
Other expenses	6,511.91	5,158.09
Total expenses	23,145.78	9,013.30
Profit/ (Loss) before share of loss of associates	-6,774.16	2,832.74
Share of Loss of Associate	-70.45	-
Profit/ (Loss) before exceptional items and tax	-6,844.61	2,832.74
Exceptional items	2,603.00	-
Profit/ (Loss) before tax	-9,447.61	2,832.74
Current tax	-	323.36
Deferred tax	-2,235.04	396.21
Pertaining to earlier years	39.79	-
Profit/ (Loss) for the year	-7,252.36	2,113.17
Other comprehensive income
Items that will not be reclassified to profit or loss
Remeasurements of the defined benefit plans	-29.82	8.26
Income tax relating to items that will not be reclassified to profit or loss	9.59	0.93
Share of Loss of Associate	-4.22	-
Total other comprehensive income	-24.45	9.19
Total comprehensive income for the period	-7,276.81	2,122.36
Earnings per share (EPS)
Basic (INR.)	-63.86	21.42
Diluted (INR.)	-59.99	21.42

Incred Capital Financial Services Private Limited Consolidated Cash Flow Statement (Rs in Lakhs)

Particulars	31-03-2023	31-03-2022
Cash flow from operating activities
Profit/ (Loss) before tax	-6,844.61	2,832.74
Adjustments
Depreciation and amortisation	1,008.15	152.6
Profit on sale of investments	-4,692.13	-7,402.09
Interest Income on Loans	-1,021.32	-2,161.38
Interest Income on investments	-	-130.36
Fair value gain on financial instruments at Fair value through P&L	-481.58	161.66
Share based payment to employees	3,612.76
Rent expense on deferred lease rentals	6.5	6.08
Allowance for credit loss	-67.22	75.71
loss on sale of fixed assets	2.24	0.28
Interest on unwinding of financial liabilities	93.61	49.54
Interest on unwinding of financial assets	-11.75	-5.29
Operating profit/loss before working capital changes	-8,395.35	-6,420.51
Adjustments for (increase) / decrease in operating assets
Trade receivables	2,229.66	-1,401.37
Other financial assets	-6,330.46	-2.04
Other non-financial assets	1,473.21	-1,480.97
Adjustments for increase / (decrease) in operating liabilities:
Trade payables	-1,906.74	2,381.49
Deposits	31.75	13
Other financial liabilities	-530.87	537.12
Other non-financial liabilities	-383.43	122.44
Provisions	134.31	12.77
Cash generated from / (used in) operations	-13,677.92	-6,238.07
Direct taxes (paid) net of refunds	-662.11	-6.18
Net cash flow from (used in) operating activities	-14,340.03	-6,244.25
Cash flows from investing activities
Purchase of Property, Plant and Equipment	-533.68	-93.86
Impact of Right of Use Asset	-61.12	-36.64
Purchase of Intangible assets (including under development)	-10.34	-
Capital work in progress	-6.34	6.69
Proceeds from sale of fixed assets	26.28	0.2
Purchase of Associate	-1,149.72	-
Purchase of investments	-9,38,213.90	-2,78,653.56
Proceeds from sale of investments	9,23,679.75	2,86,426.65
Net Proceeds from Loans	20,286.45	-7,049.31
Interest Income on Loans	1,021.32	2,161.38
Net cash flow from / (used in) investing activities	5,038.70	2,761.55
Cash flows from financing activities
Borrowings	-6,932.52	-52
Share Capital	161.63	69.12
Securities premium (Net of Share issue expenses)	13,704.65	3,242.92
payment of lease liabilities	-331.63	-144.4
Net cash flow from / (used in) in financing activities	6,602.13	3,115.64
Net increase / (decrease) in cash and cash equivalents	-2,699.20	-367.06
Cash and cash equivalents at the beginning of the year	4,561.42	4,434.15
Cash and cash equivalents at the end of the year	1,862.22	4,067.09

Here is a summary of the Cash Flow Statement for the years 2023 and 2022:

Cash Flow from Operating Activities

Profit/(Loss) Before Tax:

2023: ₹-6,844.61 thousand

2022: ₹2,832.74 thousand

The significant shift from profit to loss indicates a challenging financial year in 2023.

Adjustments:

Depreciation and Amortization:

2023: ₹1,008.15 thousand

2022: ₹152.60 thousand

Increase in depreciation and amortization expenses, likely due to higher capital investments or changes in depreciation policy.

Profit on Sale of Investments:

2023: ₹-4,692.13 thousand

2022: ₹-7,402.09 thousand

Decrease in profit on the sale of investments.

Interest Income on Loans:

2023: ₹-1,021.32 thousand

2022: ₹-2,161.38 thousand

Decrease in interest income from loans.

Interest Income on Investments:

No interest income on investments in 2023.

2022: ₹-130.36 thousand

Fair Value Gain on Financial Instruments at Fair Value Through P&L:

2023: ₹-481.58 thousand

2022: ₹161.66 thousand

Transition from gain to loss on financial instruments.

Share-Based Payment to Employees:

2023: ₹3,612.76 thousand

No such payments in 2022.

Rent Expense on Deferred Lease Rentals:

2023: ₹6.50 thousand

2022: ₹6.08 thousand

Slight increase in rent expense.

Allowance for Credit Loss:

2023: ₹-67.22 thousand

2022: ₹75.71 thousand

Reversal of credit loss allowance.

Loss on Sale of Fixed Assets:

2023: ₹2.24 thousand

2022: ₹0.28 thousand

Increase in loss from asset sales.

Interest on Unwinding of Financial Liabilities:

2023: ₹93.61 thousand

2022: ₹49.54 thousand

Increase in interest expenses.

Interest on Unwinding of Financial Assets:

2023: ₹-11.75 thousand

2022: ₹-5.29 thousand

Increase in interest income from financial assets.

Operating Profit/Loss Before Working Capital Changes:

2023: ₹-8,395.35 thousand

2022: ₹-6,420.51 thousand

Further deterioration in operating profit/loss before adjusting for working capital changes.

Adjustments for (Increase)/Decrease in Operating Assets:

Trade Receivables:

2023: ₹2,229.66 thousand

2022: ₹-1,401.37 thousand

Increase in trade receivables.

Other Financial Assets:

2023: ₹-6,330.46 thousand

2022: ₹-2.04 thousand

Significant increase in other financial assets.

Other Non-Financial Assets:

2023: ₹1,473.21 thousand

2022: ₹-1,480.97 thousand

Decrease in other non-financial assets.

Adjustments for Increase/(Decrease) in Operating Liabilities:

Trade Payables:

2023: ₹-1,906.74 thousand

2022: ₹2,381.49 thousand

Decrease in trade payables.

Deposits:

2023: ₹31.75 thousand

2022: ₹13.00 thousand

Increase in deposits.

Other Financial Liabilities:

2023: ₹-530.87 thousand

2022: ₹537.12 thousand

Decrease in other financial liabilities.

Other Non-Financial Liabilities:

2023: ₹-383.43 thousand

2022: ₹122.44 thousand

Decrease in other non-financial liabilities.

Provisions:

2023: ₹134.31 thousand

2022: ₹12.77 thousand

Increase in provisions.

Cash Generated from/(Used in) Operations:

2023: ₹-13,677.92 thousand

2022: ₹-6,238.07 thousand

Significant increase in cash used in operations.

Direct Taxes (Paid) Net of Refunds:

2023: ₹-662.11 thousand

2022: ₹-6.18 thousand

Increase in direct taxes paid.

Net Cash Flow from/(Used in) Operating Activities:

2023: ₹-14,340.03 thousand

2022: ₹-6,244.25 thousand

Substantial increase in net cash used in operating activities.

Cash Flows from Investing Activities

Purchase of Property, Plant, and Equipment:

2023: ₹-533.68 thousand

2022: ₹-93.86 thousand

Increase in capital expenditures.

Impact of Right of Use Asset:

2023: ₹-61.12 thousand

2022: ₹-36.64 thousand

Increase in costs related to right-of-use assets.

Purchase of Intangible Assets (Including Under Development):

2023: ₹-10.34 thousand

No such purchases in 2022.

Capital Work in Progress:

2023: ₹-6.34 thousand

2022: ₹6.69 thousand

Slight decrease in capital work in progress.

Proceeds from Sale of Fixed Assets:

2023: ₹26.28 thousand

2022: ₹0.20 thousand

Increase in proceeds from asset sales.

Purchase of Associate:

2023: ₹-1,149.72 thousand

No such purchases in 2022.

Purchase of Investments:

2023: ₹-9,38,213.90 thousand

2022: ₹-2,78,653.56 thousand

Significant increase in investment purchases.

Proceeds from Sale of Investments:

2023: ₹9,23,679.75 thousand

2022: ₹2,86,426.65 thousand

Increase in proceeds from investment sales.

Net Proceeds from Loans:

2023: ₹20,286.45 thousand

2022: ₹-7,049.31 thousand

Significant increase in net proceeds from loans.

Interest Income on Loans:

2023: ₹1,021.32 thousand

2022: ₹2,161.38 thousand

Decrease in interest income from loans.

Net Cash Flow from/(Used in) Investing Activities:

2023: ₹5,038.70 thousand

2022: ₹2,761.55 thousand

Increase in net cash flow from investing activities.

Cash Flows from Financing Activities

Borrowings:

2023: ₹-6,932.52 thousand

2022: ₹-52.00 thousand

Significant increase in repayment of borrowings.

Share Capital:

2023: ₹161.63 thousand

2022: ₹69.12 thousand

Increase in share capital.

Securities Premium (Net of Share Issue Expenses):

2023: ₹13,704.65 thousand

2022: ₹3,242.92 thousand

Significant increase in securities premium.

Payment of Lease Liabilities:

2023: ₹-331.63 thousand

2022: ₹-144.40 thousand

Increase in payment of lease liabilities.

Net Cash Flow from/(Used in) Financing Activities:

2023: ₹6,602.13 thousand

2022: ₹3,115.64 thousand

Increase in net cash flow from financing activities.

Net Increase/(Decrease) in Cash and Cash Equivalents

Net Increase/(Decrease):

2023: ₹-2,699.20 thousand

2022: ₹-367.06 thousand

Increase in the net decrease of cash and cash equivalents.

Cash and Cash Equivalents - Opening Balance:

2023: ₹4,561.42 thousand

2022: ₹4,434.15 thousand

Reflects the prior year 's closing balance.

Cash and Cash Equivalents - Closing Balance:

2023: ₹1,862.22 thousand

2022: ₹4,067.09 thousand

Significant decrease in closing cash balance, indicating a lower cash position at the end of 2023.

Financial Ratios of Incred Capital Financial Services Private Limited

Particulars	2023	2022
CRAR (%)	42.44%	203.99%
CRAR - Tier - I Capital (%)	34.65%	200.76%
CRAR - Tier - II Capital (%)	7.79%	3.23%

Here is a summary of the financial and operational metrics for Incred Capital Financial Services Private Limited for the year 2023 & 2022:

Capital to Risk-Weighted Assets Ratio (CRAR)

2023: 42.44%

2022: 203.99%

Insight: The CRAR has drastically decreased from 203.99% in 2022 to 42.44% in 2023. This indicates a significant reduction in the company 's capital adequacy. While a CRAR of 42.44% is still strong and above regulatory requirements, the sharp decline could be a cause for concern, suggesting that the company might have taken on more risk or reduced its capital buffer.

CRAR - Tier I Capital

2023: 34.65%

2022: 200.76%

Insight: The Tier I capital ratio has also seen a substantial decrease from 200.76% to 34.65%. Tier I capital is the core measure of a bank 's financial strength, and such a significant drop indicates a large reduction in high-quality capital, which could affect the company’s ability to absorb shocks arising from financial and economic stress.

CRAR - Tier II Capital

2023: 7.79%

2022: 3.23%

Insight: The Tier II capital ratio has increased from 3.23% to 7.79%. While this increase is positive, it is relatively small compared to the drop in Tier I capital. Tier II capital is less secure than Tier I and includes items like subordinated debt, so the overall increase in Tier II capital is not enough to offset the significant decline in Tier I capital.

Dividend History

Particulars	2023	2022
Dividend Per Share	-	-
Retained Earnings (Rs. In Lakhs)	-16,001.71	-585.43

Incred Capital Financial Services Private Limited Recent Financial Performance

Dividend per Share: The specific dividend per share figure for 2023 and 2022 is not provided, Dividend per share represents the portion of a company 's earnings that is distributed to shareholders in the form of dividends. A higher dividend per share may indicate that the company is sharing more of its profits with shareholders.

Retained Earnings: Retained earnings for 2023 amounted to Rs. -16,001.71 Lakhs, while in 2022, they were Rs. -585.43 Lakhs. Retained earnings represent the portion of a company 's profits that is reinvested in the business rather than distributed as dividends. An increase in retained earnings suggests that the company has retained more of its profits for reinvestment or future growth.

To provide a more comprehensive analysis, it would be necessary to consider additional financial metrics such as revenue, net profit, assets, liabilities, and cash flows. Additionally, an analysis of trends over multiple years and a comparison to industry benchmarks and competitors would help in assessing the company 's financial health and performance.