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    Manba Finance Limited

    MANBA
    Financial Services·23 May 2025
    Management Summary

    Manba Finance delivered strong FY25 results with significant growth in NII, AUM, and disbursements, coupled with improved asset quality and capital adequacy. Q4 FY25 saw some sequential moderation in AUM and NII growth attributed to seasonality and strategic liquidity management, which also led to a slight dip in RoA. The company highlighted its robust collection mechanisms and plans for future geographical expansion and potential new product offerings.

    Highlights

    5

    • FY25 Net Interest Income (NII) grew 49% YoY to INR129 crores.

    • FY25 Loan Disbursements grew 33% YoY to INR842 crores.

    • Asset Under Management (AUM) grew 42% YoY to INR1331 crores as of March 31, 2025.

    • Capital Adequacy Ratio (CAR) improved to 29.81% due to IPO funds.

    • GNPA reduced to 3.23% and NNPA to 2.45% as of March 31, 2025.

    Concerns

    5

    • QoQ AUM growth was slower (marginal INR31 crores increase) due to seasonality.

    • QoQ interest income growth was lower than AUM growth due to seasonality and repayment cycle.

    • QoQ other expenses increased 31% due to higher PCR and ARC revaluation.

    • QoQ other operating income declined by INR1.25 crores due to lower disbursements and associated processing fees.

    • Return on Assets (RoA) slightly decreased QoQ from 3.18% to 3.10% due to higher year-end liquidity.

    What Changed2

    vs Q1 FY26

    Guidance items8 → 3 (-5)Risks discussed3 → 2 (-1)
    Key financials

    Metrics

    14

    Periods

    3

    Headline

    7
    • Asset Under Management (Mar 31, 2025)
      ₹1,331 Cr
      YoY+42%
    • Cost of Borrowing
      10.8%
    • Gross NPA (Mar 31, 2025)
      3.2%
    • Net NPA (Mar 31, 2025)
      2.5%
    • Capital Adequacy Ratio (Mar 31, 2025)
      29.8%

    Q4 FY25

    3
    • Net Interest Income
      ₹36.5 Cr
      YoY+38%
    • Net Interest Margin
      13.6%
    • Profit After Tax
      ₹8 Cr

    FY25

    4
    • Net Interest Income
      ₹129 Cr
      YoY+49%
    • Net Interest Margin
      14.0%
    • Profit After Tax
      ₹38 Cr
      YoY+21%
    • Loan Disbursements
      ₹842 Cr
      YoY+33%

    Capital allocation

    1
    high confidence
    CategoryHeadline
    Liquidity

    Cash ₹111 crores

    Healthy liquidity buffer of approximately INR100 crores maintained at all times during the year. Bank balance of INR111 crores on the asset side at year-end, maintained to cover 1.5 months of business development amount and avoid cash flow mismatch.

    Guidance & targets

    3
    CategoryTargetPriority
    Market Share
    EV Financing Market Share in operational areas
    around 8%
    		High
    Geography Expansion
    New Geography Expansion
    Start after the season
    		Medium
    Product Offerings
    Gold Loan and Loan Against Property
    Under consideration, not before the season
    		Medium

    What to watch in Q1 FY26

    3

    New Geography Expansion

    After the season (post-November 2025)
    CurrentPenetrating existing 73 locations in 6 states.
    TargetCommencement of new geography expansion.

    Why it matters

    Indicates future growth strategy and potential for market share increase beyond current operational areas.

    So, the geography expansion will not take place in the next first 9 months. After the season gets over, we will start about the new geography expansion.

    Risks & concerns

    2
    RiskSeverity

    Seasonal fluctuations in AUM growth and interest income

    AUM growth and interest income are slower in Q4 (Jan-Mar) due to fewer festivals compared to Q3 (Oct-Dec), leading to QoQ fluctuations. — Management acknowledged

    medium

    Impact of higher liquidity on profitability metrics (RoA)

    Maintaining a higher liquidity buffer at year-end, while prudent for cash flow management, led to a slight decrease in Return on Assets (RoA) from 3.18% to 3.10% QoQ. — Management acknowledged

    low

    Q&A highlights

    7

    “AUM, this is our seasonal month where in the October, November mainly, 2 wheeler generally mostly sells more in Ganpati, Dussehra and Diwali. In Jan, Feb, March, there are hardly any festivals were there. And as our AUM has been already grown by 40%, more than 40%, so there is a lot of inflow of, you know, repayment is also there from the same loan which we have disbursed in last few months. ... So, the income which we have received on this major portfolio was from Q3 to Q4. It was not for the entire year.”

    Management explained the sequential slowdown in AUM and NII growth by attributing it to seasonal demand patterns for 2-wheelers and the timing of income recognition from the loan portfolio, providing context for short-term fluctuations.

    asked by Nemin Doshi, Geojit PMS

    2 min read5 chapters

    Detailed Narrative

    01

    Strong Financial Performance Driven by Growth and Margin Expansion

    Manba Finance reported robust financial performance for FY25, with Net Interest Income (NII) growing 49% year-on-year to INR129 crores and Profit After Tax (PAT) increasing 21% to INR38 crores. The company's Asset Under Management (AUM) expanded significantly by 42% year-on-year, reaching INR1331 crores as of March 31, 2025. Loan disbursements for the year also saw a healthy 33% growth, totaling INR842 crores, supported by improved Net Interest Margins (NIM) of 14.03% for FY25, partly due to the utilization of IPO equity proceeds.

    02

    Strategic Partnerships and EV Financing Focus

    The company announced key partnerships aimed at bolstering its market presence and supporting the electric vehicle (EV) financing segment. Collaborations with BGauss Auto Private Limited for retail financing, Prosperity for a digital platform to streamline credit flow and risk management, and Fin Coopers Capital for enhanced vehicle financing options are expected to expand reach, particularly in Madhya Pradesh, and make EV financing more accessible. Manba Finance currently holds an 8% market share in EV financing within its operational areas.

    03

    Proactive Asset Quality Management and Capital Strength

    Manba Finance demonstrated strong asset quality management, reducing its Gross Non-Performing Assets (GNPA) to 3.23% and Net Non-Performing Assets (NNPA) to 2.45% as of March 31, 2025. This was supported by a strategic 4% increase in its Provisioning Coverage Ratio (PCR), from 20% to 24% on Stage 3 and Stage 4 assets, reflecting a proactive approach to tightening credit norms. The company also maintained a robust Capital Adequacy Ratio (CAR) of 29.81%, significantly improved by funds raised through its IPO.

    04

    Seasonal Fluctuations and Liquidity Management Impact on QoQ Metrics

    While annual performance was strong, Q4 FY25 saw some sequential moderation. QoQ AUM growth was marginal (INR31 crores), and interest income growth was lower than AUM growth, primarily attributed to the seasonal nature of the 2-wheeler market (fewer festivals in Jan-Mar compared to Oct-Dec) and the company's repayment cycle. A slight decrease in Return on Assets (RoA) from 3.18% to 3.10% QoQ was noted, which management attributed to maintaining a higher liquidity buffer of INR111 crores at year-end for financial stability and to mitigate cash flow mismatches.

    05

    Operational Efficiency and Future Growth Outlook

    The company highlighted its operational efficiency, with 60% of loans sanctioned in one minute and 92% on the same day. Its in-house collection team effectively manages 85% of bounced EMIs, contributing to low NPAs. Looking ahead, Manba Finance plans to further penetrate existing locations before embarking on new geographical expansion post-November 2025. The company is also considering diversifying its product portfolio into gold loans and loan against property, with decisions expected after the current season.

    This is an AI-generated summary of a publicly available earnings call transcript. It is for informational purposes only and does not constitute investment advice, a recommendation, or an endorsement. inve.money is not a SEBI-registered investment advisor. Please consult a qualified financial advisor before making any investment decisions.