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Plenti (ASX:PLT) share price on watch after ‘exceptional growth’, BNPL launch

ASX share price on watch represented by man looking through magnifying glass
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The Plenti Group Ltd (ASX: PLT) share price is on watch today after the company released its trading update for the fourth-quarter of FY21.

The Plenti share price is $1 per share at the time of writing.

Plenti is a technology-led consumer lending and investment company that focuses on specific industries. The company offers loan products under three verticals, or revenue streams.

First it provides automotive lending for the hire or purchase of new vehicles. Second, it provides renewable energy lending for the purchase and installation of renewable energy products such as solar panels and batteries.

Finally, it also focuses on personal lending, providing fixed-term, unsecured, interest-bearing loans used for a wide variety of purposes.

Plenti’s strong fourth-quarter results

Plenti posted record quarterly loan originations of $172.4 million, 120% above prior corresponding period and 32% above its results from the prior quarter. 

It posted record quarterly loan originations in each lending vertical, across automotive, renewable energy and personal loans. Its total loan portfolio increased to $615 million, 61% above the prior corresponding period.

Funding increased through upsizing of Plenti’s automotive loan warehouse facility to $350 million. In interesting news for buy now, pay later (BNPL) investors, it also successfully launched BNPL finance for renewable energy customers.

This was one of what the company calls a series of “significant product and technology advancements”, including progress on the company’s next generation credit decisioning and pricing models.

Its prime loan portfolio also continues to demonstrate strong credit performance, with low levels of losses and 90-plus day arrears declining to 0.31%.

What Plenti management said

Commenting on the trading update, Daniel Foggo, Plenti’s CEO, said:

Plenti’s exceptional growth during the quarter was underpinned by our relentless focus on delivering faster, fairer loans, with originations for the quarter up more than 100% on the same quarter last year. Our ambition is to be Australia’s best lender. This quarter validated our ongoing investment in technology while continuing to deliver exceptional customer experiences uncompromised by our rapid growth.

With strong momentum across each part of our business, we are powering towards our one billion dollar loan book milestone.

Plenti share price snapshot

The Plenti share price has lost 17% in 2021 so far and 23% over the past 12 months. It’s down 67% against the financial services sector and 52% against the S&P/ASX 200 Index (ASX: XJO).

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Motley Fool contributor Lucas Radbourne-Pugh has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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