(i) ICL Fincorp Ltd., established in the year 1999 with registration under the Companies Act 1956, was started off as a financial services providing company. In the year 1999, the Company forayed into the non-banking financial sector (NBFC) with the approval of Reserve Bank of India. Since its inception, ICL Fincorp has witnessed unparalleled growth under the leadership of its Chairman and Managing Director, Mr. K G Anilkumar. It was by the sheer business acumen that Mr. K G Anilkumar, acquired a Chennai based NBFC company, Jawahar Finance Company and thus forayed into Non-Banking Finance field. Today, ICL Fincorp, is one of the leading Gold Loan oriented Non-Banking Finance Companies (NBFC) in South India. The company has also in its portfolio, other services like Vehicle Loans, Business Loans, Money Transfer, Forex, Travel, and Tourism, etc.

(ii) The company's first branch was established in a small town called Annamanada in Thrissur District on 20/4/2013. Since then, the company has maintained consistent and rapid growth. Today, the company has over 140 branches spread across South India. ICL has set a tall aim to achieve a total of 1000 branches all across India by the end of the year 2022.

(iii) As an organization, ICL Fincorp has a presence through its branches across five states in South India, viz. Kerala, Tamil Nadu, Karnataka, Telengana and Andhra Pradesh. The ICL Group consists of other concerns viz. ICL Chits Ltd, ICL Tour, and Travels P.Ltd, ICL Medilab P Ltd, Snow View Tex Collections P Ltd.

(iv) Loan Profile and understanding of Business:

a) Gold Loan: Walk into any of ICL branches and receive money against pledging of your gold ornaments. The company charges different interest rates ranging from as low of 9% to 28%, depending upon the tenure period. The ICL Fin Corp being a lender earns by charging heavy interest rates from the consumers for the loan given against the gold. The different gold schemes are mentioned below.

Gold Loan Product Name

1. Duration Rate of Interest ICL + (Plus) Gold Loan Up to 1 month 12% >1 to 3 months 16% >3 to 6 months 20% >6 to 12 months 24%

2. ICL Vanitha-Suraksha Up to 3 months 12% >3 to 6 months 18% >6 to 9 months 22%

3. ICL Suvarna Gold Loan Up to 3 months 18% >3 to 6 months 24% >6 to 9 months 26% >9 to 12 months 28%

4. ICL Sukrutham Gold Loan 18 monthly installments basis 9%.

Understanding Gold Business and Risk Let us suppose, the present worth of Gold in your hand is Rs.1,00,000 and you go to the ICL to get money by pledging this gold. The company will not pay you Rs. 1,00,000 as principal, but give you roughly around 65-70% of the total value. 30-35% is the safety margin for the company from the fluctuation of gold price. So, now they have given you Rs. 65000 as loan money on say 12% interest for one month. After one month, you didn't turn up to pay it back and take your gold back. Then company will sell this gold in the market to recover its value. Worst Case or Chance of loss to ICL Fin Corp: If within one month, the total worth of gold decreases below 65,000, the company will have to adjust that as loss in their books. So, the Gold loan business becomes riskier when prices of gold are falling and they flourish vice-versa.

b) Business Loan ICL offers business loans to SMEs. Such SMEs must be either running a small business unit or a shop. For such small business entities, timely availability of funds is key for enhancing their business or preparing to take advantage of the festival season. ICL, therefore, has loan portfolios from Rs.10,000 up to Rs.5 lakhs that are devised to help meet the evolving financial needs of small entrepreneurs. For more detail, click here

c) Health Insurance ICL Medicare with its Associates Liberty Videocon brings tailor-made health policies catering to customer various needs. For more detail, click here

d) Vehicle Loan ICL offers a two-wheeler vehicle loan up to 75% value of the vehicle with an attractive interest rate for a period of one year. The repayment is calculated on EMI basis. Such loans are extended to select customers only who are salaried, professionals or self-employed.

Branches Data

As of 31.03.2020 , the Company has 200 branches spread across South India with a strong workforce of 750 employees.

FY19-20 Analysis

1. The company continued to remain focused on maintaining asset quality. The total AUM for the company as a whole grew by 31% (YoY) and the growth of on-balance sheet assets were 36%.

2. The business AUM (including on book and assigned and net of provisions) in FY 20 stood at INR 249 crores as against INR 189 crores recorded in FY 19.

3. The company earned a profit after tax (PAT) of INR 57,31,734/- during the year. And the Earnings per Share is INR 0.15/.

4. More than 90% of the total portfolio is Gold Loan. When it comes to other loans,there are no fresh disbursements but the renewal of loans is allowed to genuine customers. The recovery and collection mechanism is taken care of in these segments as well.

5. In FY19-20, the company has issued ~84 Lakh Shares at Rs.20 per share.

FY20-21 Analysis of ICL Fincorp

1. The company continued to remain focused on maintaining asset quality. The total AUM for the company as a whole grew by 21% (YoY) which is a decent growth considering the kind of havoc which is created in micro-finance loan due to COVID-19. The reason being they are into gold loan which is historically remains a very low NPA business.

2. The business AUM (including on book and assigned and net of provisions) in FY21 stood at INR 301 crores as against INR 249 crores recorded in FY20.

3. The company earned a profit after tax (PAT) of 2.68 Crores- during the year. And the Earnings per Share is INR 0.62.

4. More than 90% of the total portfolio is Gold Loan and rest is Personal loan, Business Loans, Property loan

5. In FY20-21, the company has issued 1 Crores Shares at Rs.20 per share.

FY21-22 Analysis of ICL Fincorp

1. The loan book has increased from ~300 Crores in Fy21 to ~350 Crores in Fy22.

2. Net Interest Margin in FY22 is 13.47% which was slight reduce from last year NIM of 14.6%.

3. Revenue has increased from 76 Crores in Fy21 to 83 Crores in Fy22.

4. PAT has increased from 2.6 Crores in FY21 to 2.7 Crores in Fy22.

5. Current Market Price is Rs.25 per share, so, P/B is 1.47x.

6. ICL Fincorp has maintained its Non-Performing Assets (“NPA”) below 2% as on March 31, 2022. More than 90% of loan portfolio is under gold loan category and market value of gold is expected to continue its increasing trend in coming year also. So, chances of NPA is very less.