Stock of the day: Findi

(AI video summary)

This video was created on 30 May 2025 for IG audiences by ausbiz.

ASX code: FND

Mixed results amid Indian expansion

Findi, the automated teller machine (ATM) operator and digital payments provider, swung to a $12.5 million loss in the financial year (FY) 2025 after a $4 million profit the previous year. Despite earnings rising 15%, the company attributed losses to acquisition and restructuring costs.

The fintech targets India's bottom 75% population segment, representing almost 900 million potential customers from 1.4 billion people. Findi's digital business serves more than 750,000 customers monthly with strong growth.

The Reserve Bank of India's (RBI) decision to increase interchange fees could impact net profit after tax. Executive chair Nicholas Smedley highlighted the enormous addressable market opportunity despite financial headwinds.

Operational concerns emerge

Analysts express caution about Findi's structure, where local Indian management runs operations while Australian management maintains stakes. This creates visibility challenges for Australian Securities Exchange (ASX) investors.

Operating revenue declined despite reported earnings growth, with increases driven by other income rather than core business performance. This typically includes foreign exchange and asset revaluations, which do not generate corresponding cash flow.

Complex capital structure

Findi's capital structure includes refinanced convertible notes, all centred on plans to list on the Indian Stock Exchange. The strategy aims to arbitrage low ASX valuations against potentially higher Indian multiples.

For investors focused on the Indian initial public offering (IPO) opportunity, analysts suggest holding while monitoring timelines. However, for typical ASX investors, analysts suggest redirecting capital towards more transparent, profitable growth companies with stronger execution track records.