Fino Payments Bank Tanks 7% After Q2 Results

Shares of Fino Payments Bank plummeted almost 7% to INR 362.10 apiece on the BSE in early trading hours today (October 24) after the company reported a sequential decline in its net profit for the quarter ended September 2024 (Q2 FY25).

Fino Payments Bank posted a net profit of INR 21.15 Cr in Q2 FY25, a 12% decline from INR 24.27 Cr in the June quarter. However, net profit rose 8% year-on-year (YoY) from INR 19.52 Cr profit logged during the September quarter last year.

Total income in the September quarter zoomed 27% to INR 455.41 Cr from INR 358.58 Cr in the year-ago quarter. On a quarter-on-quarter (QoQ) basis, it rose 4% from INR 436.86 Cr.

CASA (Current Account Savings Account) emerged as the biggest revenue generator for Fino, contributing INR 106.7 Cr to its topline during the quarter under review. 

The company’s BC banking offering, which allows users to instantly transfer funds domestically, generated revenues to the tune of INR 100 Cr. Fino made INR 51.2 Cr, or 12% of its revenue, from its remittance offering. 

On the digital front, Fino said its digital payment services accounted for 17% of its total revenue pie for the quarter. The quarter saw Fino netting INR 79.3 Cr revenue from its digital offerings, a 10X jump from the INR 7.7 Cr it made in Q1 FY24.

Founded in 2017, Fino Payments Bank operates on an asset-light business model that principally relies on fee and commission-based income generated from merchant networks and strategic commercial partnerships.

In its annual report for the financial year 2023-24 (FY24), Fino Payments Bank’s managing director and CEO Rishi Gupta said that the company is expanding its product catalogue and has begun offering referral loans through partnerships that validate the creditworthiness of customers.

The Mumbai-based payments bank has also applied for a small finance bank licence with the Reserve Bank of India to shore up its revenue.

Fino Payment Bank operates in the business-to-business space in India’s fast-growing fintech market, which is expected to become a $2.1 Tn opportunity by 2030, as per Inc42 data.