Decillion Finance Ltd Management Discussions

Jul 23, 2024|03:31:00 PM

Decillion Finance Ltd Share Price Management Discussions


Management Discussion and Analysis mainly comprises of the statements which, inter-alia, involve predictions based on perceptions and may, therefore, be prone to uncertainties. It is the sum total of the Companys expectations, beliefs, estimates and projections which are forward looking within the meaning of applicable laws and regulations. The actual results could differ materially from those expressed herein specifically or impliedly.


Titled ‘A Rocky Recovery, the IMFs World Economic Outlook April 2023 reported that on the surface, the global economy appears poised for a gradual recovery from the devastation caused by the pandemic and, later, the conflict between Russia and Ukraine. The reopening of the Chinese economy has also contributed to the rebound and supply-chain disruptions have been unwinding, while the dislocations to energy and food markets caused by the war are receding. However, it also observed that below the surface turbulence is building, and the situation is quite fragile, as evidenced by the recent bout of banking instability.

At the same time, the report pointed out that the large scale and synchronised tightening of monetary policy by most central banks should start to bear fruit, with inflation moving back toward its targets.

The IMF (International Monetary Fund) forecast that global growth will bottom out at 2.8% in 2023 before rising modestly to 3.0% in 2024. It also expects global inflation to decrease, although more slowly than initially anticipated, from 8.7% in 2022 to 7.0% in 2023 and 4.9% in 2024.

The growth is expected to come from emerging market and developing economies, which are already powering ahead with growth rates that are nearer 4%. The advanced economies, especially the Euro area and the United Kingdom, are creating the drag with growth expected to fall to 0.7% and 0.4%, respectively, in 2023 before rebounding to 1.8% and 2.0% in the two regions in 2024.

The IMF cautioned that policymakers across the globe have a narrow path to walk to improve prospects and minimise risks. It suggested that fiscal policymakers should buttress monetary and financial policymakers actions in getting inflation back to target while maintaining financial stability. Overall, it advised that governments should aim for a tight stance while providing targeted support to those struggling most with the cost-of-living crisis.


Despite the distressed global economic landscape, the Indian economy is expected to grow at a robust 7% (in real terms) during the year ending March 2023, after posting a growth of 8.7% in FY 2021-22 according to the Economic Survey 2023.

Some of the growth drivers were the credit growth to the MSME sector, which was remarkably high, at over 30.5% on average, during Jan-Nov 2022. The capex of the central government, which increased by 63.4% in the first eight months of FY 2022-23, was another growth driver of the Indian economy. The optimistic growth forecasts also stem from a number of positives like the rebound of private consumption, which led to a boost in production activity.

While several advanced economies struggling with banking sector turmoil, bank failures, and contagion risks, the Indian banking and non-banking financial service sectors remained healthy, and financial markets evolved in an orderly manner, according to the Monetary Policy Committee (MPC) of the Reserve Bank of India (RBI).


The Indian economy is expected to witness GDP growth of 6.0% to 6.8% in FY 2023-24, depending on the trajectory of economic and political developments globally, according to the Economic Survey 2023. The survey also projects a baseline GDP growth of 6.5% in real terms in FY 2023-24. The RBI projects headline inflation at 6.8% in FY 2022-23, which is outside its target range. A surge in the growth of exports in FY 2021-22 and the first half of FY 2022-23 resulted in acceleration in production.

Looking ahead, the RBI MPC expects that higher rabi production will improve the prospects for the agriculture sector and rural demand, while steady growth in contact-intensive services is likely to drive urban demand. If these impulses play out, the consumption story will continue to power growth. Moderating commodity prices are also providing tailwinds.

Manufacturing and investment activity are expected to provide a strong thrust to growth, with the governments focus on capital expenditure and capacity utilisation reaching above its long-period average. The only concern is that despite the positive outlook, the global headwinds could impact the Indian economy through a drag from net external demand.

To monitor these positive and negative risks, the RBI assured that it will continue to balance financial conditions in line with the productive requirements of the economy, even as monetary policy moves decisively to withdraw accommodation. The MPC predicts real GDP growth of 6.5% for 2023-24, with the overall outlook remaining dynamic and fast-evolving.


The Indian financial services industry is a dynamic and evolving sector, poised for further growth and innovation. It is a vital component of the countrys economy, providing a range of financial products and services to individuals and businesses alike. The sector has seen significant growth in recent years, expanding into segments that were previously underserved or overlooked in a bid to promote financial inclusion. The industry is diverse, with a mix of traditional players such as commercial banks, insurance companies, and NBFCs, along with newer entities such as payment banks and small finance banks. The sector is well-regulated by the RBI, which has also allowed fintech companies to enter the fray, bringing innovation and efficiency to the industry. The adoption of digital technology has been a game-changer, enabling organisations to enhance customer engagement and deliver services with speed and transparency.

According to IBEF, rising incomes in India are driving the demand for financial services across income brackets. Further, there are over 2,100 fintechs operating currently, positioning India to become one of the largest digital markets, aided by the rapid expansion of mobile and internet.

NBFCs in India

The Non-Banking Financial Companies (NBFCs) sector plays a significant role in the Indian economy, providing credit to individuals, small and medium-sized enterprises, and rural areas, among others. NBFCs have emerged as a key segment in the financial sector, bridging the gap between banks and borrowers who are underserved or excluded from traditional banking services. In recent years, the sector has witnessed significant growth, fuelled by a rise in demand for credit and the emergence of new players. The sectors resilience and ability to innovate have been tested during times of economic turmoil, such as the COVID-19 pandemic.

As the economy has moved past the impact of the pandemic, the NBFCs sector is anticipated to experience a substantial growth in both FY2023 and FY2024, following the rebound of the economy. ICRA Ratings predicts that during these fiscal years, the sector will witness a loan growth of 10-12% and a rise in profitability by 50 basis points. The PCA framework implemented by RBI has created a level playing field for NBFCs with banks, thus enhancing corporate governance and leading to sustainable growth in the sector.


Decillion Finance Limited was founded in 1995 and is a registered Non-Banking Finance Company (NBFC) regulated by the Reserve Bank of India (RBI). The Company operates in the state of West Bengal and specialises in providing financial services.


DFL constantly monitors the external environments and internal situation so that it is aware of the opportunities and threats that emerge. This enables the Company to tap into the positive prospects that come its way while overcoming or bypassing the challenge of threats.


Diverse loan book presence to accelerate growth

Efficient Business Model helps to minimise risk and operating cost Adequate capitalisation to support medium-term growth plans Operates in “B2B” business segment with huge growth potential


Unpredictable policy changes by the Government Increasing competition from local and global players Higher exposure to semi-formal and informal sector customers


The Company has only one line of business, i.e., Financing and Investment Activities during the year under review, hence no segment wise information is required. The Company has no activity outside India. Therefore, there is no geographical segment.


The Reserve Bank of India (RBI) has been continually strengthening the supervisory framework from NBFCs in order to ensure sound and healthy functioning and avoid excessive risk taking. In furtherance of these objectives, RBI issued new guidelines during past years.

1. Know your customer guidance Anti money laundering Standards

2. Guidance on classification, monitoring and reporting of frauds

3. Guidance on Securitisation of Standards Assets


The Company has appointed M/s Srimal Jain & Co., Chartered Accountants, an outside agency as its Internal Auditors, who conduct internal audit for various activities. The Company has developed adequate internal control system commensurate to its size and business. Personnel of the Internal Auditor conduct periodic audits in all the areas to ensure that the Companys control mechanism is properly followed and all statutory requirements are duly complied with. The reports of Internal Auditors are submitted to the Audit Committee which further reviews the adequacy of Internal Control System.


The statements in this Management Discussion and Analysis describing the companys objectives, estimates, expectations may be “forward-looking statements” within the meaning of applicable security laws and regulations. Actual results could differ materially from those expressed or implied due to several factors which are beyond the control of the management. In accordance with the Code of Corporate Governance approved by the Securities and Exchange Board of India, Shareholders and readers are cautioned that in the case of data and information external to the company, no representation is made on its accuracy and comprehensiveness though the same are based on sources believed to be reliable. Utmost care has been taken to ensure that the opinions expressed by the management herein contain its perceptions on the material impacts on the companys operations but it is not exhaustive. The Company assumes no obligation to amend or update forward looking statements in future on the basis of new information, subsequent developments or otherwise.

For and on behalf of the Board
M/s Decillion Finance Limited
Sd/- Sd/-
Jitendra Kumar Goyal Vidhu Bhushan Verma
Managing Director Director
(DIN: 00468744) DIN: 00555238
Date: 1st September, 2023
Place: Kolkata

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