The fintech market in India is experiencing immense transformations, with the established organizations expanding their businesses even as they pursue the profitability route. The most prominent illustration of this is Progcap, the Peak XV and Tiger Global-backed fintech firm, which has reported an impressive financial performance in the fiscal year ending in March 2025.

As stated in the latest financial statements of the company obtained by the Registrar of Companies, the Gurugram startup has almost doubled its operating revenue, and it is taking colossal steps towards breaking even.

Strategic cost management and growth in operating revenue

The fiscal health of Progcap improved dramatically in FY25 with a 93% increase in revenue generated by the company. The top line of the company went up to ₹268 crore in FY25, which is a major improvement compared to the ₹139 crore in the previous financial year, FY24. At the same time, the company decreased its losses by 87%.

This expansion underscores the rising demand for the services core to the company, which deal with trying to supply debt capital to underserved micro and small businesses. Progcap has emerged as a significant part of the fintech ecosystem by digitizing supply chains and offering the much-needed access to finance to last-mile retailers. These specialty services were the only operating revenue source of the firm in the period.

The company also enjoyed the secondary income streams in addition to its core operations. Progcap gained an additional ₹10 crore in interest on deposits and current investment gains. These figures are included in the company, and the total income increased to ₹278 crore during FY25 as compared with ₹159 crore during FY24. The consistent increase in the aggregate income highlights the fact that the company can leverage its assets as it scales its major lending-related operations.

Although its revenue increased by almost two times, Progcap was able to maintain its expenditure growth at a relatively low level, and this was important in its recovering bottom line. Total costs increased by 37%, and they increased to ₹279 crore in FY25 as compared to ₹203 crore in the previous year.

An in-depth analysis of the cost structure shows that the employee benefit expenses continued to be the topmost cost center, and they occupied around 45% of the total spending. This expense was significantly stable at ₹126 crore, as compared to ₹124 crore in FY24, indicating that the firm has attained its massive growth in returns without a sharp increase in its labor expenses.

Other regions recorded huge gains. The finance expenses increased over four times to ₹91 crore in FY25 as compared to ₹22.5 crore in FY24. This increment is usually linked to the escalated price of borrowing or the magnification of lending functions.

Write-offs increased to ₹24.5 crore as compared to ₹15 crore, and there was an increase in legal charges to ₹6.5 crore. Although these costs in certain segments also increased, the overall increase in costs was strongly surpassed by the increase in revenue, which enables the firm to shift closer to a profitable position.

Strong asset position and reduction in losses

The best part of the Progcap FY25 performance is its enormous net losses decline of 87%. The company managed to reduce its losses to a bare minimum of ₹6 crore in FY25 as compared to ₹46 crore in FY24. This puts the company at the threshold of breakeven, which is a significant milestone in any fintech company that is at the growth stage.

The firm had a positive EBITDA of ₹75 crore, which indicated a robust EBITDA margin of 27.99%. This move into positive EBITDA shows that the core business is now essentially healthy and cash generating in advance of accounting interest, taxes, and depreciation.

The efficiency of the company can also be determined by its unit economics. Progcap used ₹1.04 to earn a single rupee of operating revenue in FY25, a significant improvement over the ₹1.46 that it spent in FY24. This increase in the cost-to-revenue ratio and a Return on Capital Employed (ROCE) of 7.40% indicates that the company is using its capital more effectively as it grows.

The balance sheet of Progcap is strong enough to continue with the next step in its path. As of the end of March 2025, the company had cash and bank balances amounting to ₹207 crore. Its current assets have also improved in a healthy manner, as they have increased to ₹1,799 crore. This high level of liquidity gives the firm the buffer it needs to move on with its growth and control its lending book appropriately.

A powerful team of investors supports the achievement of the company. Progcap has increased to approximately $111 million. Its list of investors comprises such high-profile investors as Tiger Global, Peak XV (formerly Sequoia Capital India), Creation Investments, and GrowX Ventures. The firm, which has co-founders Pallavi Shrivastava and Himanshu Chandra, has used this capital to develop a platform that has a substantial influence on the MSME sector through collateral-free loans and digital supply chain services.

Conclusion

The financial performance of FY25 is a turning point for Progcap. The company has increased its revenues by almost doubling them and reduced its losses by 87%, and this is a testimony that its business model is scalable and sustainable. A positive EBITDA and the approach to the breakeven point are strong performances in a competitive and capital-intensive industry.

Progcap has a strong asset base, has maintained its position with major world investors, and thus seems to be well-positioned to be able to shift out of a high-growth startup and become a profitable leader in the Indian supply chain finance market.