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    Manba Finance Q4 FY26 earnings call

    MANBA
    Financial Services·19 May 2026
    Management Summary

    Manba Finance reported strong Q4 and FY26 results, driven by significant growth in Net Interest Income and Profit After Tax, alongside robust AUM expansion. The company maintained healthy asset quality, improved its return ratios, and reduced its cost of borrowing. Strategic diversification into new geographies and product segments like MSME LAP is underway, though certain high-risk areas like 3-Wheeler EV are being approached with caution.

    Highlights

    5

    • Q4 FY26 Net Interest Income (NII) grew 34% YoY to INR 50 crore, reflecting healthy profitability.

    • Q4 FY26 Profit After Tax (PAT) grew 39% YoY to INR 11 crore, indicating strong operational momentum.

    • FY26 Asset Under Management (AUM) grew 29% YoY to INR 1,713 crore, demonstrating robust growth.

    • Return on Equity (ROE) improved from 10.25% in FY25 to 11.65% in FY26, and Return on Assets (ROA) improved from 2.58% to 2.63% in FY26.

    • Average cost of borrowing improved from 10.80% last year to 10.64%, enhancing funding efficiency.

    Concerns

    3

    • Geopolitical problems are impacting equity fundraise valuation, potentially leading to postponement.

    • The 3-Wheeler EV segment is considered higher risk due to customer profile and usage patterns, requiring a cautious approach.

    • Small business loans are being approached cautiously with increased rejection rates due to a less enthusiastic environment.

    What Changed2

    vs Q1 FY27

    Guidance items10 → 8 (-2)Risks discussed2 → 4 (+2)
    Key financials

    Metrics

    17

    Periods

    3

    Headline

    10
    • Asset Under Management (AUM)
      ₹1,713 Cr
      YoY+29.0%
    • Balance Sheet Size
      ₹1,979 Cr
    • Gross NPA (Stage-3 asset)
      3.3%
    • Net NPA (Net Stage-3 asset)
      2.5%
    • Credit Cost
      1%

    Q4 FY26

    2
    • Net Interest Income
      ₹50 Cr
      YoY+34%
    • Profit After Tax
      ₹11 Cr
      YoY+39%

    FY26

    5
    • Net Interest Income
      ₹162 Cr
      YoY+24%
    • Profit After Tax
      ₹45 Cr
      YoY+20%
    • Net Interest Margin
      13.6%
    • Gross Yield
      22.9%
    • Disbursements
      ₹977 Cr

    Segment breakdown

    Portfolio Mix
    91.8% MFL Business2.6% Co-lending Partnership4.4% DA and BC Arrangement111.0% Other Arrangement
    Product Mix
    84.5% 2-Wheeler4.9% Small Business Loan4.7% Top-up Loan3.3% 3-Wheeler150% Used Vehicle Loan
    List

    Capital allocation

    2
    high confidence
    CategoryHeadline
    Dividend

    %7.5/share (interim)

    Liquidity

    Liquidity disclosed

    Capital Adequacy Ratio (CAR) of 24.46% provides ample headroom for future growth. Expected Credit Loss provision of INR 23 crore against IRAC requirement of INR 14 crore results in a healthy excess buffer.

    Guidance & targets

    8
    CategoryTargetPriority
    Volume
    AUM Growth
    25-30%
    		High
    Volume
    Target AUM
    INR 2,300-2,400 crore
    		High
    Market Share
    Geographical Expansion - Karnataka
    Start operations
    		High
    Market Share
    Geographical Expansion - West Bengal
    Start looking at
    		Medium
    Market Share
    MSME LAP Expansion
    Start at Nasik and Ahmedabad
    		High
    Product Mix
    2-Wheeler Portfolio Ratio
    65%
    		High
    Debt
    Debt-to-Equity Ratio
    Below 4
    		High
    Other
    Equity Fundraise
    Happening
    		Medium

    What to watch in Q1 FY27

    5

    Equity Fundraise Update

    next quarter
    CurrentExpected Q3/Q4 FY26, potentially postponed due to geopolitical issues affecting valuation.
    TargetAnnouncement of fundraise or revised timeline and valuation comfort.

    Why it matters

    This is crucial for capital adequacy to support future growth and reflects management's ability to raise capital at favorable terms.

    Yes, in the previous call also we have already discussed that it is in the targeted quarter is second or maybe 3rd Quarter. But looking at the current scenario it can go into the 3rd or maybe the 4th Quarter. So, but yes, there will be definitely new fundraise will be happening this year.

    Risks & concerns

    4
    RiskSeverity

    Geopolitical problems impacting equity fundraise valuation

    Geopolitical issues are affecting valuation, potentially leading to postponement of equity fundraise from Q3 to Q4 FY26. — Management acknowledged

    medium

    Higher risk in 3-Wheeler EV segment

    Customer profile is 'dicey', and usage patterns (overloading) lead to faster depreciation and higher potential losses, requiring a very cautious and selective approach. — Analyst acknowledged

    medium

    Less enthusiastic environment for small business loans

    The company is being more cautious and increasing rejection ratios in this unsecured product segment, which is less than 5% of AUM. — Management acknowledged

    low

    Slightly higher credit loss in used 2-Wheeler segment

    Credit loss for used 2-Wheelers is expected to be around 1-1.5%, slightly higher than new 2-Wheelers (~1%). — Management acknowledged

    low

    Q&A highlights

    8

    “Looking at all these things, as per our business plan, we are expecting that after three years, the 2-Wheeler ratio will be around 65% and 35% will be other products... Maybe in 2nd Quarter, we will start our operation in Karnataka also.”

    Reveals strategic shift from high concentration in 2-Wheelers and Maharashtra to a more diversified portfolio and geographical presence, reducing risk.

    asked by Gulshan Singh

    3 min read7 chapters

    Detailed Narrative

    01

    Robust Financial Performance and Growth

    Manba Finance delivered a strong performance in Q4 and FY26. Net Interest Income for Q4 grew 34% YoY to INR 50 crore, with Profit After Tax increasing by 39% YoY to INR 11 crore. For the full fiscal year, NII rose 24% YoY to INR 162 crore, and PAT grew 20% YoY to INR 45 crore. The company's Asset Under Management (AUM) expanded by 29% YoY to INR 1,713 crore as of March 31, 2026, demonstrating consistent growth.

    02

    Prudent Asset Quality and Provisioning

    The company maintained healthy asset quality with Gross NPA at 3.33% and Net NPA at 2.46% as of March 31, 2026. Credit costs remained stable at approximately 1%. Manba Finance adopted a prudent provisioning strategy, with an Expected Credit Loss provision of INR 23 crore against an IRAC requirement of INR 14 crore, creating a healthy excess buffer. This proactive approach aims to strengthen the balance sheet and mitigate future risks.

    03

    Improved Profitability and Funding Efficiency

    Profitability metrics showed improvement, with Return on Equity (ROE) rising from 10.25% in FY25 to 11.65% in FY26, and Return on Assets (ROA) improving from 2.58% to 2.63%. The average cost of borrowing decreased to 10.64% from 10.80% last year, driven by improved credit ratings and favorable market conditions. This includes securing a INR 100 crore term loan from SBI at a competitive rate of 10%.

    04

    Strategic Diversification and Geographical Expansion

    Manba Finance is actively diversifying its product and geographical presence. The company aims to reduce its 2-Wheeler portfolio concentration from 84.5% to 65% within three years, increasing focus on other products like 3-Wheelers, used cars, and small business loans. Geographically, operations are set to begin in Karnataka in Q2 FY27, with plans to explore West Bengal by the end of the year or next year, expanding beyond its traditional Maharashtra stronghold.

    05

    New Product and OEM Partnerships Drive Growth

    The newly launched MSME LAP product has commenced operations in Mumbai and Pune, with further expansion planned for Nasik and Ahmedabad next quarter. A strategic All-India MOU with TVS Motor Company has significantly boosted the 3-Wheeler financing segment, leveraging TVS's dealer network. The company is also implementing AI for enhanced collection efficiency and dynamic pricing, indicating a focus on technology-driven improvements.

    06

    Cautious Approach to High-Risk Segments

    While pursuing growth, Manba Finance maintains a cautious stance on certain segments. The small business loan segment, being unsecured and less than 5% of AUM, is experiencing increased rejection rates due to a less enthusiastic market environment. The 3-Wheeler EV segment is also viewed as higher risk due to 'dicey' customer profiles and potential for faster depreciation, leading to a slow and selective growth strategy in this area.

    07

    Capital Raising Plans and Adequacy

    The company plans an equity fundraise in Q3 or Q4 FY26, though this timeline may be postponed due to geopolitical issues affecting valuation. Manba Finance aims to maintain its debt-to-equity ratio below 4 and boasts a healthy Capital Adequacy Ratio of 24.46%, providing ample headroom to support its future growth initiatives.

    This is an AI-generated summary of a publicly available earnings call transcript.