Agri Start-up Arya.Ag Expects Fourfold Jump In Revenue This Fiscal

Arya.ag, a nine-year-old agri start-up expects to grow its revenue and net income fourfold this fiscal. The New Delhi-based company claims to be the largest platform in terms of reach, farmers onboarded, number of farm produces traded and profitability, .

Cofounded by former ICICI banker Prasanna Rao, Chattanathan Devarajan and Anand Chandra in 2013, Arya.ag had closed FY22 with over $45 million in gross revenue. However, it has managed to cross $80 million as of July.

"Given this run-rate, we see us closing fiscal 2023 with around $175 million in top-line, and a four-times growth in net income, which stood at $0.5 million last fiscal. Till July we made a net income of $2 million, and this should grow at least four fold by March," said Rao, the co-founder and managing director of the start-up, told PTI over phone from Delhi on Tuesday.

Offering reasons for the massive spike in volume/revenue apart from inflation, he added that their geographical reach has doubled in the last year along with the number of sellers, which now stands at 4,500 farmer-sellers, farmer producer organistions and large farmers. It also works with over 650 aggregators.

The company has received $65 million in external equity capital from investors including Bengaluru-based Lightrock, Washington-based Quona Capital Management, Mumbai's Omnivore Capital and Asia Impact Fund. These investors have collectively invested $65 million and own a little less than 50 per cent of the company. The remainder equity is with the founders and some individual investors, Rao said.

The company claims to be the only agritech start-up that has been making net profit from the first year of operations.

Arya.ag has over 11,000 warehouses in over 800 locations across 450 districts spanning 21 states. Bihar is the largest among all in terms of geographical reach.

Its warehouses can store over 3,65,25,000 tonne of farm produces, which are used by over 8,000 sellers and over 2,200 trades. Annual volume of grain traded on its platform is over 7,00,000 tonne or worth around $2.5 billion, Rao said.

The grain commerce platform connects sellers and buyers of agri produce, providing assurance on quantity, quality and payments by eliminating distress sales by farmers. One of its unique services is the advance payments to farmers to the tune of 70 per cent of the value of their produce, which prevents them from resorting to distress sales, Rao said.

The company's loan book is around Rs 6,500 crore, of which half is on its own book and the rest are in the books of lending banks, which could pass this advance or loan as priority sector lending.

Arya.ag charges 12.5 per cent to 13 per cent from a farmer for the advance payment, Rao said, adding even after this an average farmer earn 15 per cent more than a farmer who is not on his platform. Some of them even make 25 per cent more for their produce, he added.

Arya's clients include farmers, farmer producer organisations (FPOs), financial institutions, SME agri processors, commodity traders and corporate agribusinesses. 

Arya also offers warehouse receipt financing via Aryadhan, its wholly-owned NBFC arm, apart from providing credit to farmers, FPOs and SME aggregators (processors/traders) who have stored agri commodities in its warehouses.