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NORTHARC - Northern ARC

📊 NSE: NORTHARC 🏢 Finance & Investments 📅 Last Updated: 12/14/2025 10:36

📢 Recent Corporate Announcements

Northern Arc Capital to Participate in Omkara Capital Investors Meet on February 21

🟡 NEUTRAL ⭐ 3/10

ROUTINE 📅 17 Feb 2026, 10:30 AM

Northern Arc Capital Limited has announced its participation in a group meeting with institutional investors and analysts scheduled for February 21, 2026. The event, titled 'Omkara Capital Investors Meet', is hosted by Omkara Capital and will be held in a physical format from 5:00 PM to 9:00 PM. The company has clarified that discussions will be limited to publicly available information, ensuring no unpublished price sensitive information is shared. This is a routine engagement aimed at maintaining transparency with the investor community.

Group meeting with investors scheduled for February 21, 2026.
The session will run for four hours from 05:00 P.M. to 09:00 P.M.
Hosted by Omkara Capital in a physical meeting format.
Company confirms no unpublished price sensitive information (UPSI) will be disclosed during the interaction.

💡 Investors should watch for any post-event presentations or transcripts uploaded to the company website for insights into management's commentary. No immediate trading action is required based on this routine disclosure.

Northern Arc Capital Releases Q3 FY26 Earnings Conference Call Transcript

🟡 NEUTRAL ⭐ 4/10

EARNINGS 📅 06 Feb 2026, 06:10 PM

Northern Arc Capital Limited has officially released the transcript for its earnings conference call held on January 30, 2026. The document details management's discussion regarding the financial results for the third quarter ended December 31, 2025. This disclosure provides investors with granular insights into the company's operational performance, asset quality, and strategic outlook as discussed with analysts. Accessing the transcript is essential for understanding the qualitative factors behind the reported Q3 numbers.

Official transcript released for the Q3 FY26 earnings call held on January 30, 2026.
Covers financial and operational performance for the quarter ended December 31, 2025.
Compliance filing under Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
Transcript available on the company website and via the provided exchange link for public review.

💡 Investors should review the transcript to gain clarity on management's guidance regarding credit growth and margin sustainability. No immediate trading action is required as this is a routine follow-up to the previously announced financial results.

Northern Arc Capital to Attend Systematix India Annual Conference on Feb 9, 2026

🟡 NEUTRAL ⭐ 3/10

ROUTINE 📅 04 Feb 2026, 05:21 PM

Northern Arc Capital Limited has scheduled a physical group meeting with institutional investors and analysts on February 9, 2026. The meeting is part of the MANTHAN - Systematix India Annual Conference held in Mumbai. The interaction is slated for a three-hour window from 10:30 AM to 01:30 PM IST. The company has explicitly stated that no unpublished price sensitive information (UPSI) will be shared during these discussions.

Participation in the MANTHAN - Systematix India Annual Conference on February 9, 2026.
Physical group meeting scheduled from 10:30 AM to 01:30 PM IST at Sofitel, BKC, Mumbai.
The conference features over 100 leading Indian corporates and marquee institutional investors.
Discussions will be restricted to publicly available documents and information.

💡 Investors should monitor the exchange filings for any investor presentations or transcripts released after the conference for insights into the company's growth outlook. No immediate action is required as this is a routine investor engagement activity.

RBI Imposes ₹2.7 Lakh Penalty on Northern Arc Capital for KYC/AML Non-Compliance

🟡 NEUTRAL ⭐ 4/10

REGULATORY 📅 31 Jan 2026, 03:18 PM

The Reserve Bank of India (RBI) has imposed a monetary penalty of ₹2.7 Lakhs on Northern Arc Capital Limited. The penalty stems from a review of the company's financial position as of March 31, 2024, which identified a lack of automated software for generating Anti-Money Laundering (AML) alerts. This was found to be in contravention of Direction 50 of the RBI (KYC) Directions, 2016. The company has confirmed that it has already implemented corrective actions and the financial impact is immaterial to its operations.

Penalty of ₹2.7 Lakhs imposed by the Reserve Bank of India (RBI) via a speaking order.
Violation pertains to the absence of automated software for AML alert generation during the FY24 review period.
The order was received by the company on January 30, 2026, under the RBI Act, 1934.
Company has already undertaken corrective actions and established necessary processes to address the lapse.

💡 The penalty amount is negligible and does not impact the company's fundamentals. Investors should treat this as a routine regulatory update while noting that the compliance gap has been addressed.

Northern Arc Capital Releases Q3 FY2025-26 Earnings Call Audio Recording

🟡 NEUTRAL ⭐ 3/10

EARNINGS 📅 30 Jan 2026, 08:17 PM

Northern Arc Capital Limited has officially released the audio recording of its earnings conference call for the third quarter ended December 31, 2025. The call, conducted on January 30, 2026, provides a platform for management to discuss the company's financial health and strategic direction. This filing follows the initial intimation sent on January 27, 2026, regarding the scheduled meet. Accessing this recording allows shareholders to hear direct responses to analyst queries regarding the company's credit portfolio and operational metrics.

Audio recording for Q3 FY2025-26 earnings call made available on the company website.
The call was held on January 30, 2026, at 6:00 PM IST.
Relates to the financial performance for the nine-month period ending December 31, 2025.
Filing submitted under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

💡 Investors should listen to the recording to gain insights into management's outlook on asset quality and growth within the diversified financial services segment.

Northern Arc Capital Schedules Q3 FY26 Earnings Call for January 30, 2026

🟡 NEUTRAL ⭐ 4/10

EARNINGS 📅 27 Jan 2026, 07:14 PM

Northern Arc Capital Limited has scheduled its earnings conference call for the third quarter of FY26 on January 30, 2026, at 6:00 PM IST. The call will focus on the company's operational and financial performance for the quarter ended December 31, 2025. Top management, including the MD & CEO Ashish Mehrotra and CFO Atul Tibrewal, will be present to discuss results and answer investor queries. This is a routine but essential event for stakeholders to evaluate the company's growth and asset quality metrics.

Earnings conference call scheduled for January 30, 2026, at 18:00 hours IST.
Discussion will cover financial results for the quarter ended December 31, 2025 (Q3 FY26).
Management representation includes the MD & CEO, CFO, and Group Risk Officer.
The call is hosted by Ambit Capital and features international dial-in options for global investors.

💡 Investors should monitor the call for management commentary on credit growth, net interest margins (NIMs), and asset quality trends. It is a key opportunity to assess the company's performance post-listing and its outlook for the diversified lending segments.

Northern Arc Shareholders Approve Appointment of Two Directors with Over 99% Majority

🟡 NEUTRAL ⭐ 4/10

MANAGEMENT 📅 24 Jan 2026, 09:30 PM

Northern Arc Capital Limited has announced the successful passage of two key board appointments via postal ballot. Shareholders approved the appointment of Ms. Vidya Krishnan as an Independent Director and Ms. Anuradha Rao as a Non-executive Non-Independent Director. Both resolutions received overwhelming support, with over 99.9% of votes cast in favor. The voting process saw a total turnout of 38.33% of the outstanding shares, concluding on January 24, 2026.

Ms. Vidya Krishnan appointed as Independent Director with 99.9977% of votes in favor.
Ms. Anuradha Rao appointed as Non-executive Non-Independent Director with 99.9235% approval.
Total of 6,19,38,145 votes were polled, representing 38.33% of the total shareholding.
The resolutions were officially deemed passed on the e-voting conclusion date of January 24, 2026.

💡 No immediate action is required as these are routine management appointments. Investors should monitor if these board additions bring specific strategic expertise to the company's credit and diversified finance operations.

Northern Arc Capital Submits SEBI Regulation 74(5) Compliance Certificate for Q3 FY26

🟡 NEUTRAL ⭐ 2/10

ROUTINE 📅 06 Jan 2026, 06:51 PM

Northern Arc Capital Limited has filed its quarterly compliance certificate under Regulation 74(5) of the SEBI (Depositories and Participants) Regulations, 2018. The certificate, provided by KFin Technologies Limited, confirms that all share dematerialization and rematerialization requests for the quarter ended December 31, 2025, have been processed. This is a standard regulatory filing required for all listed companies to ensure the accuracy of electronic shareholding records. There are no financial implications or operational changes associated with this announcement.

Compliance certificate submitted for the quarter ended December 31, 2025.
Issued by KFin Technologies Limited, the Registrar and Share Transfer Agent.
Confirms adherence to SEBI (Depositories and Participants) Regulations, 2018.
Filed with both BSE and NSE on January 6, 2026.

💡 No action is required as this is a routine administrative filing. Investors should continue to monitor the company's upcoming quarterly financial results for performance insights.

Northern Arc Capital to Close Trading Window from Jan 1, 2026 for Q3 Results

🟡 NEUTRAL ⭐ 3/10

ROUTINE 📅 29 Dec 2025, 04:44 PM

Northern Arc Capital Limited has announced the closure of its trading window for all designated persons starting January 1, 2026. This move is a standard regulatory requirement under SEBI (Prohibition of Insider Trading) Regulations, 2015, ahead of the declaration of financial results. The closure pertains to the unaudited financial results for the third quarter ending December 31, 2025. The trading window will remain shut until 48 hours after the results are officially disclosed to the stock exchanges.

Trading window closure effective from January 1, 2026
Closure relates to the review of Unaudited Financial Results for the quarter ending December 31, 2025
Restriction applies to all designated persons and their immediate relatives as per Company Code of Conduct
Window to reopen 48 hours after the board meeting and submission of results to BSE and NSE

💡 This is a routine compliance notification and does not impact business fundamentals. Investors should watch for the announcement of the specific board meeting date to evaluate the company's Q3 performance.

Northern Arc Capital Receives GST Demand and Penalty Totaling ₹4.65 Crore

🔴 NEGATIVE ⭐ 4/10

REGULATORY 📅 25 Dec 2025, 05:21 PM

Northern Arc Capital Limited has received a GST order from the Chennai South Commissionerate for the period April 2018 to March 2023. The order includes a tax demand of ₹2.33 crore and an equivalent penalty of ₹2.33 crore, totaling approximately ₹4.65 crore plus interest. The demand arises from alleged ITC mismatches, incorrect head classification of credits, and non-payment of IGST under RCM on foreign borrowings. The company believes the demand is not maintainable and is currently evaluating an appeal process.

Total GST demand of ₹2.33 crore and a matching penalty of ₹2.33 crore imposed.
Issues cited include GST credit mismatches between GSTR-3B and GSTR-2A filings.
Alleged non-payment of IGST under Reverse Charge Mechanism (RCM) on import of services for foreign borrowings.
The order covers a five-year period from April 2018 to March 2023.
Company intends to contest the order and does not expect a material impact on operations.

💡 Investors should monitor the outcome of the company's appeal, though the financial impact is relatively small compared to the company's overall balance sheet. No immediate action is required as tax disputes of this nature are common in the financial services sector.

Northern Arc Capital Seeks Shareholder Approval for Appointment of Two Directors

🟡 NEUTRAL ⭐ 4/10

MANAGEMENT 📅 24 Dec 2025, 06:13 PM

Northern Arc Capital Limited has initiated a postal ballot process to obtain shareholder approval for two key board appointments. Ms. Vidya Krishnan is proposed as an Independent Director for a five-year term effective from October 31, 2025, to October 30, 2030. Additionally, Ms. Anuradha Rao is proposed as a Non-executive Non-Independent Director for a one-year term. The remote e-voting period for shareholders is scheduled from December 26, 2025, to January 24, 2026.

Appointment of Ms. Vidya Krishnan as Independent Director for a 5-year term starting Oct 31, 2025.
Appointment of Ms. Anuradha Rao as Non-executive Non-Independent Director for a 1-year term.
Remote e-voting period runs from Dec 26, 2025 (09:00 AM) to Jan 24, 2026 (05:00 PM).
Cut-off date for determining shareholder voting eligibility was Dec 12, 2025.
Final results of the postal ballot to be announced on or before Jan 28, 2026.

💡 Shareholders should review the profiles of the proposed directors and participate in the e-voting process before the January 24 deadline. These are routine governance appointments and are not expected to have a direct impact on the stock price.

NORTHARC Allots 5,500 Equity Shares Under ESOP Plan

🟡 NEUTRAL ⭐ 3/10

ROUTINE 📅 04 Dec 2025, 06:46 PM

Northern Arc Capital Limited has allotted 5,500 equity shares under its Employee Stock Option Plan 2016. The shares have a face value of ₹10 each and rank pari-passu with existing equity shares. Following the allotment, the paid-up equity share capital of the company increased from ₹1,61,56,63,750 (16,15,66,375 shares) to ₹1,61,57,18,750 (16,15,71,875 shares). The company is seeking listing and trading approval from BSE and NSE.

Allotted 5,500 equity shares under ESOP Plan 2016
Face value of shares is ₹10 each
Equity share capital increased to ₹1,61,57,18,750
Total shares outstanding after allotment: 16,15,71,875

💡 This is a routine update regarding ESOP allotment. Investors should monitor the company's performance and financial results for more significant insights.

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💰 Financial Performance

Revenue Growth by Segment

The Direct-to-Customer (D2C) business assets under management grew by 32% YoY, with the MSME segment specifically growing by 42% YoY. Intermediate retail grew by 13% YoY, while performing credit funds increased by 14% YoY. Total AUM reached INR 13,351 Cr as of June 2025, a 12% YoY increase from Q1 FY25.

Geographic Revenue Split

Not disclosed in available documents, though secured business loans are noted to be spread across seven states with 84 branches.

Profitability Margins

Net Interest Margin (NII) stood at 9.0% for H1 FY26. Profit After Tax (PAT) was INR 318 Cr in FY24 and INR 264 Cr in 9M FY25. Return on Managed Assets (RoA) moderated to 2.2% in FY25 and Q1 FY26 from 2.8% in FY24, primarily due to a 205 bps increase in credit costs.

EBITDA Margin

Pre-Provision Operating Profit (PPoP) was 6.1% of quarterly average total assets in H1 FY26, down slightly from 6.3% in H1 FY25. Net Revenue margin stood at 9.7% for H1 FY26.

Capital Expenditure

The company raised INR 500 Cr through an IPO in September 2024, with net proceeds of INR 449.85 Cr fully utilized for onward lending to meet future capital requirements. Additionally, equity funding of INR 3,823 Cr was received in April 2024.

Credit Rating & Borrowing

The company holds a CARE A1+ rating for its INR 500 Cr Commercial Paper. Interest expenses stood at 6.2% of average total assets in H1 FY26, compared to 6.7% in H1 FY25, reflecting a diversified funding profile.

⚙️ Operational Drivers

Raw Materials

Capital is the primary 'raw material' for NACL. Interest expense, representing the cost of this capital, accounts for 6.2% of average total assets, which is approximately 64% of the total net revenue of 9.7%.

Import Sources

Sourced from a network of over 1,000 investor partners including domestic banks, mutual funds, insurance companies, and offshore development finance institutions like the International Financial Corporation (IFC).

Key Suppliers

Key capital providers include the International Financial Corporation (IFC) and various domestic banks and private wealth firms.

Capacity Expansion

Expanded physical infrastructure by adding 15 new branches in H1 FY26 and hiring 100 employees in sales and collection. The branch network for secured business loans reached 84 branches by June 2025.

Raw Material Costs

Interest expense (cost of funds) was 6.2% of average assets in H1 FY26. Procurement strategy involves diversifying the funding base across NCDs, securitization, and bank loans to manage liquidity.

Manufacturing Efficiency

Cost-to-income ratio stood at 37.0% in H1 FY26, compared to 36.5% in H1 FY25, reflecting investments in branch and personnel expansion.

Logistics & Distribution

Operating costs, including distribution and branch expenses, stood at 1.3% of average total assets in H1 FY26.

📈 Strategic Growth

Expected Growth Rate

30%

Growth Strategy

NACL aims to achieve over 30% growth in its direct retail book by expanding its branch network (15 new branches in H1 FY26) and increasing headcount in sales/collections. The strategy focuses on MSME lending (42% growth) to build long-tenured annuity income from secured asset pools.

Products & Services

Microfinance loans, MSME loans, consumer finance, vehicle finance, affordable housing finance, and agricultural supply chain finance. Also provides syndication, structuring services, and fund management through AIFs.

Brand Portfolio

Northern Arc, Nimbus (technology platform), Altifi (retail debt investment platform), Pragati Finserv (MFI subsidiary).

New Products/Services

Secured business loans, started in Q4 FY22, now contribute 9% of AUM as of June 2025. The Altifi platform is expanding into the debt segment with pending stockbroker registrations.

Market Expansion

Expanding direct retail presence through its own branch network and the Pragati Finserv subsidiary, specifically targeting the MSME and rural finance sectors.

Strategic Alliances

Partnerships with smaller NBFCs and digital platforms for retail lending, accounting for 29% of AUM. Pragati Finserv acts as a Business Correspondent for direct MFI lending.

🌍 External Factors

Industry Trends

The industry is shifting from wholesale NBFC lending to direct retail and co-lending models. NACL has repositioned itself with retail exposures increasing from 17% in March 2022 to 52% in June 2025.

Competitive Landscape

Competes with other systemically important NBFCs and digital lending platforms in the MSME and consumer finance space.

Competitive Moat

Durable advantage through the 'Nimbus' platform which has 15 years of credit data and relationships with 1,000+ investors. This network effect facilitates debt placement for over 300 partner institutions.

Macro Economic Sensitivity

Sensitive to interest rate cycles and rural economic health. MFI stress in FY25 was driven by broader sector headwinds, impacting credit costs by over 2%.

Consumer Behavior

Increased demand for digital-first credit and secured MSME loans, prompting NACL to expand its D2C segment by 32% YoY.

Geopolitical Risks

Exposure to offshore investors like IFC makes the company sensitive to international capital flow regulations.

⚖️ Regulatory & Governance

Industry Regulations

Categorized as NBFC-Middle Layer under RBI Scale Based Regulations. Complies with MFIN guardrails for microfinance and RBI capital adequacy norms (CRAR at 26.1% vs regulatory minimum).

Environmental Compliance

Direct exposure to environmental risks is considered low due to the service-oriented nature of the business.

Taxation Policy Impact

Tax expense was 0.8% of average total assets in H1 FY26.

Legal Contingencies

The company spent INR 6.09 Cr on CSR obligations as per Section 135 of the Companies Act. No specific pending court case values were disclosed in the provided text.

⚠️ Risk Analysis

Key Uncertainties

Asset quality in the secured business loan segment is a concern, with 90+ DPD rising to 6.9% in June 2025 from 3.4% in December 2024. Credit costs rose significantly to 3.22% in FY25 due to MFI stress.