This ASX small-cap stock is up 500% in 2024. Here's why it just crashed

Findi Ltd (ASX: FND) shares are having a disappointing finish to the week.

In morning trade, the ASX small cap stock is down 19% to $6.25.

Though, shareholders of the India-focused digital payments and financial services provider won't be too dismayed given that its shares remain up 500% year to date.

Why is this ASX small cap stock crashing today?

Investors have been hitting the sell button today after Findi released its half year results.

For the six months ended 30 September, the ASX small cap stock reported revenue of $33.9 million and EBITDA of $12.9 million. This represents modest increases of 6.6% and 2.4%, respectively, over the prior corresponding period.

This result was well short of the run-rate you would expect it to require given its full year guidance, which may explain why its shares are crashing today.

Commenting on the half, the company's executive chair, Nicholas Smedley, said:

Transactions per day, a key performance indicator for our ATM business, were abnormally constrained during the first half of FY25 by the [Indian] general elections that ran for six weeks from 19 April 2024 to 1 June 2024. In addition to travel restrictions and many additional public holidays the general elections involve various measures restricting and regulating cash transactions.

However, Smedley notes that the transaction trends have returned to normal since the elections. He also believes the company is still on track to achieve its guidance in FY 2025. He said:

The transactions per day have trended back to historical norms following the elections. Nonetheless we are firmly on track to deliver on our full-year financial guidance, driven by the State Bank of India (SBI) contract rollout commencing in early December 2024 and the ramp up of Findi-branded White Label ATMs (WLA) expected to commence in the early part of the 2025 calendar year.

Guidance

The ASX small cap stock advised that it continues to expect full year revenue in the range of $80 million to $90 million and EBITDA in the range of $30 million to $35 million.

The company notes that its revenue and EBITDA growth in the second half are expected to be driven by the new 10-year agreement with SBI and the deployment of White Label ATMs under the transferred TCPSL licence.

It also reminds investors that revenue and EBITDA are traditionally weighted to the second half of the financial year. This trend is magnified this year with SBI and WLA due to commence in the second half.

The post This ASX small-cap stock is up 500% in 2024. Here's why it just crashed appeared first on The Motley Fool Australia.

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. 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 Scott Phillips.

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