Northern Arc Capital, a prominent non-banking financial company (NBFC), saw its share price rise significantly after reporting strong financial results for the June quarter of FY25. The company's shares surged by up to 5.26%, reaching an intraday high of ₹915 per share on October 1, 2024. This rise in Northern Arc's stock price comes on the back of its stellar quarterly performance, underscoring its strength in the share market investment landscape.
Impressive June quarter results boost investor confidence
Northern Arc Capital's share price rally can be attributed to its solid financial performance in Q1FY25. The company reported a 32.4% year-on-year (YoY) increase in profit, amounting to ₹93.6 crore, up from ₹70.7 crore in the same quarter last year (Q1FY24). Furthermore, the total revenue from operations grew by an impressive 44% annually, reaching ₹577.7 crore in Q1FY25, compared to ₹401.4 crore in Q1FY24.
Interest income, a crucial metric for financial companies, also saw significant growth. Northern Arc Capital reported a 50.7% YoY increase in interest income, rising to ₹549 crore in Q1FY25 from ₹364.5 crore in the corresponding quarter of FY24. This robust financial performance has reaffirmed investor faith in the company's growth potential, positioning it as a strong contender in the share market investment sector.
Stellar market debut adds to momentum
Northern Arc Capital made a strong debut on the stock exchanges on September 24, 2024. The shares were listed at ₹351 on the BSE, reflecting a premium of 33.40% over its issue price of ₹263. On the NSE, the shares opened at ₹350, marking a 33.07% premium. The positive market sentiment surrounding its initial public offering (IPO) has further contributed to its success in the share market.
Since its listing, Northern Arc's shares have consistently performed well, driven by both positive financial results and strong investor interest. As of 10:05 AM on October 1, 2024, Northern Arc Capital shares were trading 2.12% higher at ₹305.60, while the BSE Sensex saw a modest rise of 0.14%.
Background and future outlook
Founded in 2009, Northern Arc Capital has made significant strides in providing retail loans to underserved households and businesses across India. With a diversified business model spanning various sectors and regions, the company has facilitated over ₹1.73 trillion in financing for approximately 101.82 million individuals as of March 31, 2024. As a registered NBFC with the Reserve Bank of India, Northern Arc Capital has established itself as a key player in India's financial sector.
The company's impressive financial results for the June quarter, combined with its strong IPO debut, have bolstered investor confidence, making Northern Arc Capital an attractive option for those interested in share market investment. With its focus on reaching underserved markets and its continued growth, the company is poised to remain a strong contender in the share market for the foreseeable future.
Conclusion
Northern Arc Capital's strong financial performance in the June quarter of FY25, along with its stellar market debut, has propelled its share price upwards. With profits soaring by 32.4% and revenue growing by 44%, the company has demonstrated its ability to navigate the challenges of the financial landscape. For investors looking for share market investment opportunities, Northern Arc Capital presents a promising option. As the company continues to grow and expand its services, it is well-positioned to deliver long-term value to its shareholders.
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