Manappuram Finance Ltd Management Discussions

Manappuram Finance Limited: An Overview

Manappuram Finance Limited (hereafter referred to as MAFIL or the Company) is a leading non-banking financial company (NBFC) in India, with its Registered office and corporate headquarters located in Valapad, Thrissur. Over the years, the Company has transformed into a well-diversified financial services institution, with a strong national presence. The Company has been expanding rapidly to extend its offerings beyond gold loans, including microfinance, vehicle finance, affordable housing finance, loan against properties and MSME lending, positioning it to meet the diverse financial needs of a wide customer base.

With its ranking as the second-largest gold loan NBFC in India, MAFIL enjoys a strong brand identity and consumer confidence across multiple regions. The strong focus on innovation enables the Company to introduce industry-leading solutions in gold financing, including early rollout of its Online Gold Loan (OGL), supported by a secured cellular vaulting framework. This digital solution provides customers with gold-backed credit access, offering 24x7 location-independent access and simplified documentation. The Companys multilingual mobile application complements this, improving accessibility and inclusivity by serving customers across multiple socio-economic segments, strengthening its position as a technology-led and customer-focused financial services provider.

Additionally, the Company operates through its diversified subsidiaries, extending its reach in the Indian financial services industry.

Asirvad Microfinance Limited (AMFL), acquired by MAFIL in 2015, is a Non-Banking Financial Company-Micro Finance Institution (NBFC-MFI), providing microfinance solutions to women from economically weaker households, with its diversified portfolio comprising income-generation loans, gold loan, product loans and MSME financing.

Manappuram Home Finance Limited (MAHOFIN): MAHOFIN emphasizes the affordable housing industry, providing lending for home construction, home improvement and selected commercial property requirements to retail borrowers.

Manappuram Insurance Brokers Limited (MAIBRO): MAIBRO operates as the insurance brokerage firm of MAFIL, enabling

the distribution of life and general insurance solutions through established partnerships with prominent insurance companies.

Manappuram Comptech and Consultants Limited (MACOM): MACOM focuses on providing technology support services, with capabilities spanning application development for digital personal lending and loan management systems.

Economic Overview Global Economy

The global economy in FY 2025-26 operated within a complex and increasingly uncertain macroeconomic environment, marked by trade restrictions, policy uncertainty and persistent geopolitical tensions. Ongoing conflicts in Eastern Europe and the Middle East, including the Russia-Ukraine war, continued to disrupt global supply chains, energy markets and investor sentiment, leading to periodic volatility in commodity prices and financial conditions. At the same time, rising tariffs, changing trade arrangements and increasing geo-economic fragmentation added to uncertainty in global trade and investment flows.

Despite these headwinds, global economic activity remained resilient during the year, supported by stable labor markets, continued fiscal support and technology-led investments, particularly in Artificial Intelligence (AI). Economies also adapted through diversified trade routes, enhanced energy security measures and supply chain realignment, which contributed to a relatively stable recovery. As a result, global growth stood at 3.4% in CY 2025, compared to 3.3% in CY 2024.

Advanced economies recorded growth of 1.9% in CY 2025, supported by relatively stable labor markets, easing financial conditions and recovering demand. Meanwhile, Emerging Market and Developing Economies (EMDEs) expanded by 4.4%, driven by resilient domestic consumption, improving activity across manufacturing and services, and continued infrastructure investments in key Asian economies.

Global headline inflation moderated to 4.1% in CY 2025, reflecting easing supply-side pressures and the impact of earlier monetary tightening measures. However, inflation trends remained uneven across regions, with inflation remaining higher in the United States while remaining relatively subdued in several other major economies.

Real GDP Growth Percentage

Outlook

As CY 2026 unfolds, the global economy faces renewed uncertainty, largely driven by escalating tensions in West Asia and disruptions across critical energy transit routes. Rising concerns around the supply of oil, LNG, LPG and fertilizers have intensified risks related to energy security, inflationary pressures and supply chain stability. Against this backdrop, global growth is projected to moderate to 3.1% in CY 2026 before improving marginally to 3.2% in CY 2027.

However, improving diplomatic efforts, strategic energy diversification and stronger regional co-operation are expected to gradually ease these pressures. This is likely to support supply chain stability, moderate inflation, and foster a more balanced and resilient global economic recovery.

Advanced economies are expected to grow at 1.8% in CY 2026, while emerging market and developing economies are projected to expand by 3.9%, supported by domestic demand and continued infrastructure spending. Growth in the United States (U.S.) remains a key driver of the global outlook, with the IMF raising the U.S. forecast and GDP projected to grow by about 2.3% in CY 2026 and 2.1% in CY 2027.

Central banks are expected to remain cautious, while governments continue to focus on fiscal discipline, targeted policy support and strengthening supply chain resilience amid the evolving global economic landscape.

Indian Economy

The Indian economy remained one of the fastest-growing major economies in FY 2025-26, supported by resilient domestic demand, infrastructure-led investment and policy reforms. According to the Provisional Estimates released by the Ministry of Statistics and Programme Implementation (MoSPI), real GDP grew by 7.7% during the year, while real Gross Value Added (GVA) increased by 7.9% to 294.91 Lakh Crore.

The services sector remained the key growth driver, while manufacturing witnessed continued improvement supported by government-led production initiatives and infrastructure spending. India continues to remain among the worlds largest

economies, currently ranking as the sixth-largest economy globally in nominal GDP terms as per the IMF. Private consumption and investment remained the primary drivers of economic growth. Structural reforms such as GST, Production Linked Incentive (PLI) schemes, and Make in India 2.0 continue to improve formalization, manufacturing competitiveness and ease of doing business, while strengthening Indias position within global supply chains. The Index of Industrial Production (IIP) grew by 4.1% year-on- year in March 2026, driven by growth in the manufacturing (4.3%) and mining (5.5%) sectors. The continued expansion in industrial activity, supported by healthy demand conditions and ongoing investments, augurs well for the manufacturing sector and provides a favorable environment for future growth.

The conflict in West Asia and disruptions across global trade routes have created fresh uncertainty around energy prices, logistics and availability of critical industrial inputs. As an import-dependent economy for crude oil and intermediate goods, India remains exposed to global higher energy prices, inflationary pressures, supply chain disruptions and commodity price volatility. However, diversified sourcing strategies, domestic manufacturing capabilities and integration with emerging markets are helping mitigate external risks and support industrial continuity.

The Governments large-scale investments, reforms and flagship initiatives, such as Make in India, Production Linked Incentive (PLI) Schemes, have been instrumental in fostering industrial growth. The PLI scheme has attracted investments of approximately

2.16 Lakh Crore across 14 key sectors, in line with the national goals like Atmanirbhar Bharat and Indias vision of a US? 5 Trillion economy.

Inflation moderated significantly during the year, with the RBI lowering its CPI inflation forecast for FY 2025-26 to 2.1%, supported by favorable supply conditions and easing food prices. In response, the RBI reduced the repo rate cumulatively by 0.75% to 5.25%, supporting credit availability and investment activity. Indias exports are projected to approach US? 1 Trillion in FY 2026-27, strengthened by trade agreements, manufacturing scale-up and improving export competitiveness.

Outlook

Indias Real GDP growth for FY 2026-27 is estimated at 6.9%, driven by the double engine of consumption and investment. It reaffirms Indias status as the fastest-growing major economy for the fourth consecutive year. The nation is expected to reach a US? 30-35 Trillion economy by 2047, entering the league of developed nations. Structural reforms and sustained growth momentum are driving this rapid progress, while digital and physical infrastructure are also expanding significantly. However, the RBI has highlighted that although Indias growth outlook remains resilient, the risks to growth are tilted to the downside due to prolonged geo-political tensions, global trade uncertainties and external economic headwinds.

Amid persistent trade policy uncertainties, geo-political tensions, and tighter financial conditions, Indias growth outlook remains resilient, supported by strong domestic consumption, easing inflation, and a revival in private investments. Initiatives such as Make in India 2.0 will prioritize emerging and high-growth sectors while improving the business environment. The PLI scheme continues to act as a catalyst for scaling manufacturing, boosting exports, and enhancing Indias competitiveness. Improved rural consumption, driven by moderating inflation, further bolsters this growth trajectory.

Indias Union Budget FY 2026-27 emphasizes public investment by raising the capital expenditure (capex) outlay to a record 12.2 Lakh Crore. This nearly 9% increase from the previous years estimate of 11.2 Lakh Crore is intended to sustain economic momentum and fulfill the governments Viksit Bharat vision for a developed India. Capital expenditure is prioritized in the budget, with allocations directed towards roads, railways, ports, airports, power transmission and urban infrastructure.

(Source: PIB, PIB, Global Economic Cooperation (GEC), PIB, Economic times, RBI Annual report 2025-2026

Industry Overview

Indian Financial Services Industry

Indias financial services sector recorded growth during FY 2025-26, reflecting the expansion of credit, digital financial services, and formal banking access across the economy. This growth was driven by resilient domestic consumption, financial inclusion, demand for Retail and MSME financing, and adoption of digital payment and lending platforms. Despite global challenges such as geo-political tensions, commodity price volatility, and changing monetary conditions, the sector remained stable due to regulatory oversight by the Reserve Bank of India (RBI), healthy capitalization, and improved balance sheets across Banks and Non-Banking Financial Companies (NBFCs).

The total financing market in India, comprizing Scheduled Commercial Banks (SCBs) and Non-Banking Financial Companies (NBFCs), continued to expand during FY 2025-26. Bank credit growth in India remained high, reflecting healthy economic activity, rising private investments, and sustained consumer demand. As per the Ministry of Finance, credit growth of SCBs stood at 15.9% in FY 2025-26 compared to 10.9% in the previous year, while aggregate credit outstanding reached 212.9 Lakh Crore, increasing by 29.2 Lakh Crore over the previous year Stronger credit flows to NBFCs during March 2026 contributed significantly to the 19.0% year-on-year growth in services sector credit, underscoring the sectors expanding role in financial intermediation and credit delivery. Growth was broad-based across sectors, led by services, personal loans, agriculture, and industry. Credit to the services sector grew by 19.0%, supported by higher lending to NBFCs, trade, and commercial real estate. Industrial credit expanded by 15.0%, driven mainly by MSME lending, while agriculture and allied sector credit grew by 15.7% due to sustained rural demand and improved formal credit penetration. Personal loans also recorded growth of 16.2%, supported by housing, vehicle, and gold-backed loans. The continued expansion in bank credit indicates strong domestic demand, improved confidence among borrowers, and a stable banking environment supported by healthy balance sheets and low-stressed assets.

In FY 2025-26, Indias financial services sector continued to advance through greater adoption of AI-driven solutions, expansion of fintech services, and stronger digital public infrastructure. Initiatives such as the Unified Lending Interface (ULI) and the Account Aggregator (AA) framework enabled faster, more personalized credit delivery through secure data sharing. The sector also witnessed growth in cross-border digital payments and fintech integration, while Regulators increased focus on cybersecurity, digital resilience, and multi-currency payment settlement systems.

Indias digital payments ecosystem continued to expand strongly during FY 2025-26, supported by increasing smartphone penetration, merchant acceptance, and policy support from the Government, RBI, and NPCI. Unified Payments Interface

(UPI) remained the key growth driver and emerged as the worlds largest real-time payment system. During FY 2025-26, UPI processed over 24,162 Crores transactions with a total transaction value of approximately 314 Lakh Crore, registering a year-on-year volume growth of 30.0% and value growth of 20.6%. UPI also accounted for nearly 85% of Indias digital payment volumes and around 49% of global real-time payment transactions. The platform witnessed participation from over 700 banks, reflecting deeper penetration across retail, merchant, and rural transactions. Growth in low-value merchant payments, rising use of QR-based payments, and increasing cross-border UPI acceptance further strengthened Indias digital payment infrastructure and financial inclusion initiatives.

From a regulatory standpoint, the RBI has maintained a vigilant stance to ensure financial stability. The RBI, in its Financial Stability Report for December 2025, highlighted that system-level indicators relating to capital adequacy, liquidity and profitability remained steady during the year. The Gross Non-Performing Assets (GNPA) ratios have shown steady improvement, reflecting a disciplined approach to asset quality even as credit volumes expand.

Buy Now, Pay Later (BNPL) remained a strong, short-term digital credit option in FY 2025-26, driven by increasing e-commerce adoption, wider digital payment integration, and borrower preference for flexible repayment methods. The Indian BNPL industry is projected to grow from US? 30 Billion in 2025 to US? 78 Billion by 2030. Concurrently, RBI has revised the co-lending framework, shaping the next phase of credit expansion by strengthening bank-NBFC partnerships, enhancing risk sharing and governance framework, and enabling sustainable Retail and MSME lending.

(Source: PIB, PIB)

Outlook

The Indian financial services sector continues to witness a growth trajectory for the near to medium term, led by strong macroeconomic fundamentals, resilient policy support and increasing digital adoption. Credit growth is projected to remain steady, shaped by continued demand across renewable energy, MSMEs, agriculture and other emerging priority sectors. Strengthened asset quality and sound capital structures bolster resilience to potential external shocks.

Indias retail lending market is set to nearly double by FY2030 and now serves as the primary driver of overall loan book expansion. This momentum is propelled by rising disposable incomes and digital-first lending models that have expanded formal credit access to Middle India and young, digitally native borrowers.

Technological adaptation, such as digital platforms, AI and agentic AI, is anticipated to improve customer experience, operational efficiency and risk management abilities, allowing institutions to scale and manage costs effectively. Increased retail participation and engagement of digitally native and young customers will shape product innovation, with mobile-first and AI-incorporated channels increasing inclusion. Parallelly, to ensure more

foreign participation and support the ability of the financial services for the long-term, the RBI is reviewing the current bank licensing and ownership norms. Capital markets are projected to maintain resilience, led by investor confidence, varied capital sources and constructive regulatory oversight. Sectoral growth in the future can be attributed to focused sustainable finance, green investment, and a rapid expansion of mutual funds. Emerging digital banks and wealth tech platforms are expected to rise, driven by increasing income levels, growing investor participation and enhanced financial literacy.

NBFC Sector

Indias Non-Banking Financial Company (NBFC) sector continued to play an important role in credit delivery during FY 2025-26, particularly in retail finance, MSME lending, vehicle finance, gold loans, housing finance, and rural credit. The sector supported financial inclusion by extending credit access to underserved and semi-urban markets where traditional banking penetration remains relatively lower. During FY 2025-26, NBFCs continued to strengthen their position within the retail lending ecosystem, supported by sustained demand across secured retail segments and increasing customer preference for specialized lenders. NBFC credit grew by around 13-15% during FY 2025-26, while NBFC credit grew 16.7% year-on-year in FY 2025-26. Retail assets remained the primary growth driver, accounting for nearly 57% of the sectors credit portfolio. The growing contribution of NBFCs to retail lending, particularly in segments such as gold loans, reflects their expanding market presence, wider distribution reach and ability to offer faster and more accessible financing solutions.

The Gold Loan segment remained one of the strongest enablers for NBFCs, supported by rising gold prices, collateral values, and borrower preference for secured credit. NBFCs emerged as the fastest-growing lender category in gold loans, capturing nearly 213% year-on-year growth in disbursements, outpacing public sector and private sector banks.This underscores their role in the gold loan segment through customer outreach and quick disbursement capabilities.

NBFCs also maintained a dominant position in the Personal Loan segment, particularly in smaller-ticket and digitally originated loans. NBFCs continued to dominate the personal loan segment during FY 2025-26, accounting for 91.3% of personal loan origination volumes and 39.8% of origination value. Their presence in low-ticket consumer lending continued to support credit access for new-to-credit and underbanked customers.

The Two-Wheeler Loan segment continued to witness NBFCs commanding during FY 2025-26. Owing to integrated financing models, streamlined underwriting practices, and outreach across underserved customer segments, their market position continued to strengthen.

NBFCs also retained leadership in the Consumer Durable Loan market during FY 2025-26. In FY 2025-26, NBFCs accounted for 85% of Consumer Durable Loan originations value and 88% of originations volume, Their performance is attributed to

convenient disbursement, distribution networks, Buy Now Pay Later (BNPL) offerings, and point-of-sale (POS) financing models. In contrast, private banks share in the segment continued to decline, declining to 12.1% of value and 10.9% of volume during the same period, indicating a shift in the competitive landscape toward NBFCs financing models.

prices, higher ticket sizes and strong demand for secured credit. industry is benefiting from increasing demand for accessible credit and continued strength in gold prices.

Growth of Outstanding Gold Loans in India

The structural advantages of NBFCs across Indias retail lending ecosystem include faster turnaround times, underwriting models, localized customer servicing, digital onboarding capabilities, and access across Tier II, Tier III, and rural markets. These capabilities enabled NBFCs to expand across high-growth retail lending, strengthening their role in serving underserved borrowers.

Regulatory oversight over the NBFC sector also continued to evolve during FY 2025-26, with the Reserve Bank of India introducing significant regulatory changes for NBFCs. These are aimed at balancing risk management with ease of doing business to support growth. Key norms included the rationalization of classification, simplified branch expansion, and reduced compliance burdens for smaller entities.

Outlook

Led by resilient economic growth, MSME credit demand, sustained retail, and a vigilant regulatory landscape, the Indian NBFC sector is expected to remain buoyant. Additionally, data-driven underwriting, constant digitalization and fintech collaborations are projected to improve risk management, scalability and operational efficiency. The stable bank-NBFC funding, diversification in borrowing aid funding access, results in strengthened liquidity and reduced refinancing risks. Investors confidence and balance sheet stability in the NBFC sector are likely to be boosted by calibrated regulatory approaches.

The evolving shift towards digitization, ESG-compliant lending, and retail-oriented products will shape the NBFCs business model of the future. NBFCs are expected to address various customer requirements, enhance service quality, and reinforce long-term customer relationships, owing to the expanded use of AI-driven customer insights, personalized offerings and data analytics. Overall, NBFCs continue to remain well-positioned by greater financial inclusion and long-term economic development.

Gold Loan Industry Overview

Indias gold loan market continued to expand during FY 2025-26, supported by rising demand for secured borrowing, increasing gold prices, and stronger participation from organized lenders. Gold-backed financing remained a preferred credit option for individuals, small businesses, traders, and rural households due to faster loan processing, lower documentation requirements, and immediate liquidity availability. The Indian gold loan is emerging as the fastest-growing segment within retail credit as the outstanding gold loans increased from approximately 12.4 Lakh Crore in March 2025 to 18.6 Lakh Crore in March 2026, reflecting 50.4% year-on-year growth, supported by rising gold

Economic uncertainty and inflationary pressures have increased reliance on gold-backed financing, particularly in rural and semi-urban markets where access to traditional credit remains relatively limited. Faster disbursement timelines and minimal documentation continue to support adoption across customer segments. Regulatory measures introduced by the RBI, including tighter KYC requirements and prudential norms for gold-backed lending, have also strengthened transparency and consumer confidence in the sector. The industry is additionally witnessing competition from banks, NBFCs, and fintech-led lenders, resulting in improved customer service, digital loan processing, and more flexible repayment structures.

Gold loans emerged as one of the fastest-growing retail credit segments in India during FY 2025-26. Average ticket sizes in gold loans also increased sharply from 1.4 Lakhs in FY 2024-25 to 2.1 Lakhs in FY 2025-26, reflecting rising gold prices and increasing borrower preference for collateral-backed products. Favorable regulatory changes, including higher permissible loan-to-value ratios for smaller-ticket loans, also supported borrower eligibility and expansion of the gold loan market during the year.

Indias household gold holdings have increased significantly due to the sharp rise in gold prices during FY 2025-26. Indian households held nearly 34,600 tons of gold as of March 2026, valued at approximately US? 5.1 Trillion, equivalent to nearly 124% of Indias GDP. Despite the large household gold base, penetration of formal gold-backed lending remains relatively low, indicating substantial long-term growth opportunities for the organized gold loan industry. Southern India continues to account for the largest share of gold loan demand due to higher household gold ownership, strong cultural preference for gold, and deeper presence of banks and NBFCs across the region.

Source: Researchandmarkets

(Source: Morgan Stanley Report, IMARC, Crifhighmark, Crifhighmark, BFSI)

Outlook

The Indian gold loan industry is expected to experience rapid growth. Constant formalization, enhanced customer experience, and growing trust in regulated lending organizations also drive its growth. Driven by government initiatives such as the Digital India Mission, digital infrastructure in India is strengthened, improving connectivity and adopting technology-led gold loans. Additionally, under the vigilance of RBI gold loan rules, new provisions, directions, and restrictions are introduced for both lenders and borrowers, such as the reduction of the Loan-to-Value (LTV) ratio to 75%, enhancing customer protection. With nearly 3,000 new branches, focused solely on gold lending to open in 2026, NBFC lenders are responding to an increasing number of secured borrowing options, leading to a surge in the gold loan segment.

[Source: Economic times]

Overview of Other Business Verticals Micro Finance Industry (MFI)

The Micro Finance Industry in India remains a key contributor to advancing financial services, expanding credit and allied financial

services in underserved communities. Over time, the sector has witnessed significant transformation, driven by increasing technology adoption to enhance outreach, a structured regulatory framework and improving customer experience. Particularly, NBFC-MFIs play an integral role in the formal financial landscape, enhancing inclusive growth and access to finance for economically vulnerable citizens.

Owing to the government-led measures, such as Pradhan Mantri Jan Dhan Yojana (PMJDY), Pradhan Mantri MUDRA Yojana (PMMY), Atal Pension Yojana (APY), and similar initiatives, the foundation of the sector is strengthened. These programs are aimed at widening access to banking, household credits, insurance, and pensions outside the formal financial structures. In these contexts, MFIs function as effective last-mile delivery sources, connecting informal economic participants and regulated financial institutions. With its focused lending to self-employed individuals, women and small entrepreneurs, the industry contributes to livelihood creation, social empowerment, and income generation, strengthening its relevance in Indias inclusive development objectives.

India Microfinance Market Forecast

Size, By Provider Type, 2025-2034 (US? Billion)

MFI Industry Performance in 2025- 2026

Indias microfinance industry witnessed a phase of consolidation during FY 2025-26 after a period of rapid expansion in previous years. The sector remained focused on maintaining portfolio quality, improving underwriting standards, and strengthening borrower discipline amid liquidity constraints and stress in unsecured lending segments. Despite moderation in disbursements, Microfinance Institutions (MFIs) continued to play an important role in providing financial access to low-income households, women borrowers, and rural entrepreneurs across the country.

According to the Microfinance Industry Network (MFIN) Report for Q3 FY 2025-26, microfinance operations were spread across 36 states and union territories covering over 714 districts as of December 31, 2025. The overall microfinance portfolio stood at approximately 3.15 Lakh Crore, reflecting moderation in portfolio growth due to cautious lending practices and slower wholesale funding availability to NBFC-MFIs. NBFC-MFIs remained the largest category of lenders with a 42.1% share of the industry portfolio, followed by banks and small finance banks.

The sector witnessed lower disbursement volumes during the first half of FY 2025-26 due to tighter underwriting norms

and increased focus on customer indebtedness monitoring. The industrys client base also moderated compared to the previous year as lenders adopted a more selective approach towards fresh lending.

At the same time, asset quality indicators exhibited a marked improvement by the end of FY 2025-26. Portfolio-at-risk (PAR) metrics improved significantly, reflecting stronger collection efficiencies and improved borrower repayment behavior. PAR for 31-90 days declined to 0.8% as of March 31, 2026, from 2.8% a year earlier, while PAR for 91-180 days moderated to 1.2% from 3.5% over the same period. Improved collection performance, prudent underwriting practices and the implementation of sectoral guardrails contributed to the strengthening of credit quality, indicating that the microfinance industry is gradually returning to asset quality levels.

The industry also witnessed increasing adoption of digital processes and data-driven lending models during the year. MFIs continued to invest in digital collections, e-KYC systems, AI-based risk assessment, and account aggregator frameworks to improve operational efficiency and borrower monitoring. Financial inclusion initiatives, government support for rural credit access, and growing integration of fintech platforms continued to support long-term development of the sector.

(Source: Mfinindia, Financialexpress)

Outlook

Looking ahead, MFIs growth is projected to be more risk-aligned and measured, with greater emphasis on portfolio value creation rather than rapid expansion. Growth will also be augmented by increased reach in underserved geographies, renewed credit assistance to first-time borrowers in rural areas and MSMEs, and enduring regulatory policy aimed at financial inclusion. Macroeconomic tailwinds, including a 7.7% GDP growth, public spending in infrastructure development and rising prospects for export-oriented microenterprises, are projected to enhance the industrys growth trajectory.

The outlook for the microfinance industry remains cautiously positive, supported by improving collection trends, rural demand recovery, and the continued need for small-ticket credit across underserved segments. Good monsoon conditions, improving rural cash flows, and stabilization in borrower repayment behavior are expected to support a gradual recovery in sector growth. With increasing national development priorities, including Aatmanirbhar Bharat and Viksit Bharat 2047, MFIs are well-positioned to contribute to inclusive development. Reaching a diverse borrower base is strengthened by MFIs emphasis on responsible lending, impact-oriented financial options and digital enablement.

Automobile Industry

Indias automobile industry recorded its highest-ever annual sales across all major vehicle categories during FY 2025-26, supported by strong consumer demand, favorable policy measures, lower financing costs, and improving economic activity. According to the latest data released by the Society of Indian Automobile

Manufacturers, the industry witnessed broad-based growth across passenger vehicles, commercial vehicles, two-wheelers, and three-wheelers.

Passenger vehicle sales reached a record 4.64 Million during FY 2025-26, registering growth of 7.9% over the previous year. The segment benefited from improved affordability following GST reforms, personal income tax relief measures, and multiple repo rate cuts by the Reserve Bank of India (RBI), which reduced financing costs for consumers. Electric passenger vehicle registrations also increased significantly during the year, contributing to overall segment growth. Passenger vehicle exports reached an all-time high of approximately 0.91 Million supported by steady demand from the Middle East, Africa, and Latin America.

The two-wheeler segment recorded its highest-ever annual sales of 21.71 Million in FY 2025-26, reflecting growth of 10.7% over the previous year and surpassing the earlier peak achieved in FY 2018-19. Growth was driven by stronger urban demand, improved financing availability, and increasing adoption of electric two-wheelers. Exports of two-wheelers also reached a record 5.18 Million during the year, registering growth of 23.4%, supported by wider global acceptance of Indian brands and competitive pricing.

The commercial vehicle segment posted its highest-ever sales of 1.08 Million during FY 2025-26, registering growth of 12.6% compared to FY 2024-25. Increased infrastructure activity, higher capital expenditure, stronger fleet replacement demand, and improved logistics movement supported segment growth. Lower borrowing costs following repo rate reductions also encouraged vehicle purchases by transport operators and fleet owners. Commercial vehicle exports increased by 17.4% during the year to around .10 Million units.

Three-wheeler sales also reached a record level of 0.84 Million in FY 2025-26, growing by 12.8% year-on-year. Demand was supported by increasing urban mobility requirements, growth in e-commerce logistics, and rising penetration of electric autorickshaws. Expansion of permit issuance for internal combustion engine (ICE) three-wheelers in select states also contributed positively to industry growth.

Overall automobile production in India stood at 2.83 Million.units during FY 2025-26, reflecting strong manufacturing activity and sustained domestic demand. The industry also benefited from improving macroeconomic conditions, rising consumer confidence, and increasing adoption of electric mobility solutions.

The increasing availability of vehicle financing remained an important growth driver, supporting the industrys expansion. With softer interest rates, enhanced loan-to-value norms, and wider outreach of NBFCs across rural and semi-urban geographies, affordability has improved. Additionally, enhancements in borrower credit profiles facilitated the participation of the first-time buyer group, contributing to stable sectoral growth.

(Numbers in Million)

Category	FY 2022- 23	FY 2023- 24	FY 2024- 25	FY 2025- 26
Passenger Vehicles	3.89	4.22	4.30	4.64
Commercial Vehicles	0.96	0.97	0.96	1.08
Three- Wheelers	0.49	0.69	0.74	0.84
Two- Wheelers	15.86	17.97	19.61	21.71
Grand Total	21.20	23.86	25.61	28.27

Source: (Society of Indian Automobile Manufacturers (SIAM)

Vehicle Finance Industry

Vehicle financing continues to support Indias automotive sector, reinforcing consumer ademand and sustaining overall industry growth. Competitive lending rates, increased credit access and a wide range of financing products support the steady demand across commercial, passenger and two-wheeler segments. To sustain vehicle sales, financing-led affordability plays a crucial role, particularly in rural and semi-urban areas, followed by formal credit expansion. Flexibility in repayment structures and loan product customization has further increased vehicle ownership, addressing broader mobility requirements across various income groups.

The vehicle financing segment continued to witness healthy growth during FY 2025-26. The outstanding auto loan portfolio increased from 8.2 Lakh Crore as of March 2025 to 9.3 Lakh Crore as of March 2026, registering a year-on-year growth of 13.9%. The number of active auto loans also increased from

158.9 Lakhs to 171.6 Lakhs during the same period, reflecting sustained vehicle demand and continued credit penetration across customer segments.

Outstanding Auto Loan Growth in India

The vehicle financing industry in India is registering strong growth due to increasing disposable incomes, rising ambitions for car ownership, and easy access to credit facilities in urban, semi-urban, and rural areas. The rise of online lending platforms and fintech services has greatly improved access to loans, allowing for faster approval and easier documentation procedures. Government policies encouraging car ownership and the growing middle-class population are driving the demand for financing solutions for passenger cars, two-wheelers, and commercial vehicles.

Passenger vehicles dominate the market with a share of 48.0% in 2025, driven by growing urbanization, rising disposable incomes, and favorable financing schemes attracting first-time buyers across metropolitan and tier-II cities.

New vehicles represent the largest segment with a market share of 74.9% in 2025, supported by manufacturer warranties, attractive financing offers, and consumer preference for latest technology and safety features.

The India vehicle financing landscape is undergoing significant transformation with the convergence of traditional banking services and digital lending innovations. Financial institutions are broadening their presence in tier-II and tier-III cities by forming strategic partnerships with automobile dealers and fintech firms. Reflecting growing investor confidence in specialized auto lending, The Reserve Bank of Indias regulatory framework supporting digital lending has enhanced transparency and consumer protection while encouraging innovation in loan products. Rising vehicle prices coupled with limited upfront affordability have made financing an essential component of automobile purchases, with the growing used vehicle market creating new opportunities for specialized financing products.

Outlook

Looking forward, the vehicle financing sector is projected to grow, aided by increasing vehicle costs, rising aspirations for commercial and personal transportation and increased lending in underserved regions. Intensifying digital adoption among Banks, fintech companies and NBFCs will lead to leveraging online channels to provide faster approvals, customized offerings and streamlined disbursal. Digital underwriting and AI-driven

credit assessment strengthen risk assessment capabilities while reducing processing times, with notable benefits for first-time borrowers in Tier II and Tier III regions. Additionally, RBIs supportive regulations, increasing income levels and rising credit awareness are expected to stimulate sectoral growth. Emerging prospects in electric vehicle (EV) adoption, fleet financing and used vehicle financing are likely to unlock new market opportunities.

Housing Finance Industry

The housing finance sector in India continued to witness stable growth during FY 2025-26, supported by urbanization, rising household income, favorable demographics, and continued policy support for affordable housing. The sector remains an important contributor to residential demand, financial inclusion, and infrastructure development across urban and semi-urban markets.

The total housing loan portfolio across banks, Non-Banking Financial Companies (NBFCs), and Housing Finance Companies (HFCs) reached approximately 40.8 Lakh Crore in 2025, registering around 10% year-on-year growth. Housing Finance Companies (HFCs) recorded nearly 12% credit growth during FY 2025-26, while their Assets Under Management (AUM) increased to approximately 9.8 Lakh Crore, reflecting nearly 15% year-on-year growth. The sector continued to benefit from sustained demand across salaried, self-employed, and affordable housing borrower segments.

Housing finance demand also expanded in semi-urban and emerging markets due to wider lender presence, improved digital underwriting systems, and increasing accessibility of formal credit. Housing loans as a percentage of GDP increased from around 8% in FY 2014-15 to approximately 11% in FY 2024-25, reflecting deeper mortgage penetration within the economy. Indias housing finance market is estimated at approximately

US? 430.74 Billion in 2026 and is projected to reach nearly US? 809.07 Billion by 2031, growing at a CAGR of 13.44%.

The interest rate environment during FY 2025-26 remained relatively supportive for housing demand. The Reserve Bank of India (RBI) maintained a moderately accommodative stance, with the repo rate easing to around 5.25% during FY 2025-26. Stable borrowing costs supported affordability and sustained demand for housing loans across borrower categories. However, lenders remained cautious in credit underwriting amid evolving macroeconomic conditions and moderation in overall retail credit growth.

The industry continued to remain diversified and competitive, with Public Sector Banks retaining a dominant position in housing credit. Private sector banks strengthened their market presence through digital capabilities and faster loan processing, while HFCs focused on affordable housing, self-employed borrowers, and underserved customer segments. Total disbursements of HFCs grew 19.5% year-on-year, highlighting their continued role in last-mile credit delivery.

Affordable housing continued to remain a key growth segment during the year. . Affordable Housing Finance Companies (AHFCs) also recorded strong growth, with AUM increasing nearly 19% year-on-year to approximately 1,58,449 Crores during FY 2025-26. Demand remained strong among informal income borrowers and first-time homebuyers.

The sectors financial profile remained stable during the year, supported by healthy capitalization levels, diversified funding sources, and prudent underwriting practices. Gross Non-Performing Assets (GNPA) for HFCs remained stable at around 1.7%, indicating healthy portfolio quality despite broader stress in unsecured retail lending segments. As the sector evolves, AUM growth is anticipated to normalize to healthy and sustainable levels of around 20% by FY 2026-27.

Outlook

The outlook for the Indian housing finance sector remains positive, supported by sustained urbanization, rising home ownership demand, favorable demographics, and continued government focus on affordable housing and infrastructure development.

Growth opportunities are expected to remain strong across affordable housing, self-employed borrower financing, and emerging urban markets. Increasing adoption of digital loan processing, AI-based underwriting systems, and data-driven risk assessment tools is expected to improve operational efficiency and customer experience across the sector.

Going forward, stable interest rates, policy continuity, and continued infrastructure spending are likely to support housing demand and credit growth. However, liquidity conditions, funding costs, property price movements, and broader macroeconomic trends may continue to influence sector performance. Overall, the housing finance industry is expected to maintain steady long-term growth supported by expanding mortgage penetration and increasing financial inclusion.

Insurance Industry

Indias insurance sector continued to witness stable growth, with the domestic market expected to reach US? 221.9 Billion in 2026 and further grow to US? 361.0 Billion by 2033 at a CAGR of 7.2%. India remained the 10 th -largest insurance market globally in 2024 with a 1.8% market share. Insurance penetration stood at 3.7%, comprizing 2.7% for life insurance and 1.0% for non-life insurance, while insurance density improved to US? 97, indicating significant long-term growth potential. This expansion was supported by increasing awareness, regulatory support under the Insurance for All by 2047 initiative and rising private sector participation. The retail segment accounted for nearly 65% of the market in 2025 and is expected to grow at a CAGR of 12.4% through 2031.

The life insurance industry witnessed a strong recovery during FY 2025-26, with new business premiums increasing by 15.7% year-on-year to 4.60 Lakh Crore, compared with a growth of 5.1% in FY 2024-25. Private insurers outpaced the industry growth, recording a 16.7% increase in new business premiums, while LIC reported a growth of 14.9%. The recovery was supported by improved traction in both individual and group businesses, normalization of business volumes following regulatory changes and increased demand for protection and savings products. The sustained growth momentum, coupled with expanding distribution channels and digital initiatives, reinforces the long-term growth potential of the life insurance sector.India currently ranks as the fifth-largest life insurance market among emerging economies and is expected to become the sixth-largest insurance market globally within the next decade.

The industry also witnessed increasing preference for protection-oriented and non-participating (non-par) products due to higher profitability, capital efficiency, and guaranteed return structures. Unit Linked Insurance Plans (ULIPs) continued to record strong demand as tax-efficient, market-linked

investment products combined with life insurance protection. Growth in the group insurance and credit life segment remained linked to expanding retail lending, with Indias retail loan portfolio increasing to 162.7 Lakh Crore, reflecting 18.1% year-on-year growth and nearly 690 Million active loan accounts.

Annuity and pension products continued to gain importance due to rising longevity and increasing retirement planning awareness. Indias pension ecosystem also expanded significantly, with National Pension System (NPS) subscribers reaching 211.7 Lakhs and assets under management rising to approximately 16.1 Lakh Crore. Despite increasing financialization, pension assets remain relatively low at around 14% of GDP, creating long-term growth opportunities for retirement-focused insurance products.

Regulatory reforms continued to support industry development during the year. The Insurance Regulatory and Development Authority of India (IRDAI) continued to advance its Insurance for All by 2047 initiative to improve insurance penetration and accessibility. IRDAI also proposed mandatory adoption of Indian Accounting Standards (Ind AS) from April 1, 2026, to improve transparency and align the sector with global reporting practices. The transition towards Risk-Based Capital (RBC) norms is expected to strengthen underwriting discipline and capital efficiency. Additionally, IRDAI is working on reforms relating to commission structures and the proposed Bima Sugam digital marketplace to improve customer accessibility, transparency, and digital insurance distribution

(Source: Mordor intelligence, IBEF, CRIF, PIB, , PIB, , IRDAI, Persistence market research, IRDAI, IBEF, Careratings)

Outlook

The medium-to-long term outlook for the Insurance industry in India remains positive, augmented by multiple structural drivers such as increasing disposable income, rising protection awareness and constant digital integration. The industry offers substantial opportunities for growth, is driven by broader market access of Tier II and Tier III cities, a young workforce, and an evolving preference of customers towards retirement-focused and protection-oriented solutions.

In the regulatory landscape, initiatives of the Insurance Regulatory and Development Authority of India (IRDAI) include streamlining product approval, increasing foreign direct investment limits up to 100% and sustaining emphasis on financial inclusion, all of which provide a supportive operating environment for insurers. Advancements in digital technologies, including artificial intelligence, end-to-end digital onboarding and data analytics, further reinforce underwriting capabilities, fraud management and customer experience. Similarly, insurers are diversifying product offerings to address the changing needs of women, senior citizens and gig economy participants and progressively integrating Environment, Social and Governance (ESG) considerations into business strategies. With the insurers evolving to become financial solution partners comprehensively, the industry is projected to play a critical role in long-term savings, capital formation and socio-economic development in India.

Business Review

Manappuram Finance Limited, with its focused yet diversified business model, operates primarily in gold-backed lending while steadily expanding its presence across complementary financial services, including microfinance, affordable housing finance, vehicle and equipment finance, MSME lending and allied businesses. Gold loans continue to remain the cornerstone of the Companys operations, supported by a scalable, low-ticket and short-tenure lending model that leverages Indias significant household gold holdings. During FY 2025-26, the Companys consolidated gold loan AUM stood at 50,953 Crores, registering a strong year-on-year growth of 99.1%, reaffirming the segments role as the primary growth driver of the business.

By providing quick and secured credit against pledged gold jewelry, the Company continues to address borrowers short-term liquidity requirements, particularly in rural and semi-urban regions with relatively lower penetration of formal banking services. The inherent strengths of the gold loan business, including shorter loan maturities, high portfolio churn and secured collateral-backed lending, continue to support risk management and balance sheet resilience. The Company has also strengthened its product framework in line with revised regulatory guidelines by introducing consumption loans and income-generating loans within defined LTV and tenure guardrails, enabling more structured customer segmentation and improved underwriting standards.

The Company along with its subsidiaries operates through an extensive branch network of over 5,000 branches across the country with a consolidated employee base of more than 42,000 employees, enabling penetration into underbanked geographies. Speed and convenience remain central to the Companys operating model. Standardized appraisal mechanisms, real-time credit evaluation and technology-enabled processes facilitate faster loan disbursement and enhanced customer servicing. Branch-level operational flexibility, exercised within clearly-defined risk management and governance frameworks, further enhances responsiveness and execution efficiency.

Over the years, the Company has built a trusted brand franchise in the gold loan industry, strengthened by its long-standing customer relationships and operational rigor in managing appraisal, custodial and valuation risks. Continued investments in digital capabilities are further enhancing customer engagement and operational productivity. The Companys Online Gold Loan (OGL) platform, one of the earliest digital gold loan solutions introduced by an NBFC in India, enables eligible borrowers to avail, renew and manage gold loans digitally through seamless and paperless processes. Supported by integrated digital KYC, instant approvals, repayment tracking and re-pledge functionalities, the Company continues to strengthen customer convenience, accessibility and turnaround efficiency. Backed by its operational capabilities, diversified lending franchise and technology-led ecosystem, the Company remains well-positioned to achieve growth in the evolving digital financial services landscape.

Business Performance in FY 2025- 26

During FY 2025-26, Manappuram Finance Limited delivered a resilient operational performance despite a challenging macroeconomic environment and stress in select unsecured lending segments. The Company continued to strengthen its position in secured lending, particularly in the gold loan business, while adopting a calibrated and risk-conscious approach across microfinance, vehicle finance, MSME lending and housing finance operations. Supported by strong customer demand, favorable gold prices and disciplined underwriting practices, the Company maintained business momentum and balance sheet strength during the year.

The Companys consolidated Assets Under Management (AUM) increased by 48.3% YoY to 63,798 Crores in FY 2025-26 from

43,034 Crores in FY 2024-25, primarily led by expansion in the gold loan portfolio. Consolidated revenue from operations stood at 9,509 Crores during the year, while Profit After Tax (PAT) stood at 993 Crores. The Company maintained a strong capital position with a Standalone Capital Adequacy Ratio (CRAR) of 21.3%, supported by diversified borrowing sources and prudent liquidity management.

Gold loans remained the primary growth engine of the Company during FY 2025-26. Consolidated gold loan AUM rose sharply by 99.1% YoY to 50,953 Crores, accounting for nearly 80% of the consolidated AUM compared with 59% in the previous year. The strong growth was supported by rising gold prices, increased economic activity, improving rural demand and growing customer preference for secured credit products. The Company added approximately 3.16 Lakh new customers during Q4 FY 2025-26 alone, taking the consolidated outstanding customer base to around 27.11 Lakh customers. Gold holdings under management increased to approximately 63 tons as of March 31, 2026.

During the year, the Company further strengthened its gold loan product framework in line with revised regulatory guidelines governing lending against gold collateral. The Company introduced new product categories comprizing consumption loans and income-generating loans, enabling it to cater more effectively to household financing requirements, livelihood and small business funding. These products were launched with defined guardrails relating to loan-to-value (LTV) ratios, customer eligibility and tenure structures, improving underwriting discipline and customer segmentation. The revised framework also enhanced customer due diligence practices and strengthened delinquency management.

The Company continued to invest significantly in digital capabilities and process innovation during FY 2025-26. The Companys Online Gold Loan (OGL) platform witnessed strong adoption, with online gold loans accounting for approximately 92% of the total gold loan portfolio by the end of Q4 FY 2025-26. Through integrated digital KYC processes, instant approvals, online repayment systems and re-pledge functionalities, the Company enhanced customer convenience,

turnaround efficiency and operational productivity. The Company also continued leveraging analytics, digital monitoring systems and technology-enabled collection mechanisms to strengthen portfolio oversight and improve customer servicing.

The microfinance business operated in a relatively cautious environment during the year due to sector-wide stress and elevated borrower leverage. However, the Companys subsidiary, Asirvad Microfinance, implemented several corrective and stabilization measures, including tighter underwriting standards, calibrated disbursement strategies, strengthened collection infrastructure and geographical portfolio optimization. These strategic interventions began yielding gradual improvements during Q4 FY 2025-26. The microfinance business reported improvement in collection efficiencies, while the proportion of the new portfolio improved substantially, strengthening overall asset quality trends. Asirvads AUM stood at 6,793 Crores as of March 31, 2026.

Across vehicle finance, MSME finance and affordable housing finance, the Company adopted a calibrated growth strategy prioritizing portfolio quality and risk-adjusted returns over

aggressive expansion. Exposure to select stress-prone segments was moderated, underwriting standards were tightened, and collection mechanisms were strengthened to improve recovery efficiency and portfolio resilience. Vehicle finance AUM stood at 2,991 Crores, MSME and allied lending portfolio stood at

3,351 Crores, while the affordable housing finance portfolio stood at 1,852 Crores as of March 31, 2026.

The Company also continued strengthening its operational and funding profile during the year. Consolidated borrowing costs declined to 8.6% in Q4 FY 2025-26 from 9.4% in Q4 FY 2024-25, supported by diversified funding sources and improved liability management. The Company maintained healthy liquidity buffers with consolidated cash and cash equivalents of 6,149 Crores as of March 31, 2026.

With continued emphasis on secured lending, digital transformation, operational efficiency and prudent risk management, the Company remains well positioned to capitalize on long-term opportunities in the financial services sector while maintaining sustainable and balanced growth across business verticals.

Credit Rating

Credit Rating Agency	Type of facility	March 31, 2026		March 31, 2025
		in Crores	Rating	in Crores	Rating
CRISIL	Bank Loan Facility - Long- Term	8,875	CRISIL AA/Stable	7,585	CRISIL AA/Stable
Bank Loan Facility - Short- Term		6,125	CRISIL A1+	4,415	CRISIL A1+
Non- Convertible Debentures		5,025	CRISIL AA/Stable	4,064.77	CRISIL AA/Stable
Commercial Paper		4,000	CRISIL A1+	4,000	CRISIL A1+
CARE	Bank Loan Facility - Long- Term	17,000	CARE AA Stable	9,490	CARE AA Stable
Bank Loan Facility - Short- Term		5,000	CARE A1+	5,510	CARE A1+
Non- Convertible Debentures		1,360.25	CARE AA Stable	1,610.25	CARE AA Stable
Commercial Paper		4,000	CARE A1+	4,000	CARE A1+
Brickwork	Non- Convertible Debentures	20.48 BWR AA(Stable)		790.37	BWR AA (Stable)

Credit Rating

Credit Rating Agency	Type of facility	March 31, 2026		March 31, 2025
		in Crores	Rating	in Crores	Rating
S&P	Senior Secured Notes	2,506.05	BB- /Stable	2,506.05	BB- /Stable
FITCH	Senior Secured Notes	2,506.05	BB- /Stable	2,506.05	BB- /Stable

Financial Review

The table below presents the Companys standalone and consolidated financial performance for FY 2025-26, highlighting key parameters such as income, expenditure and profitability.

Consolidated Results at a glance (in Crores)

Particulars	FY 2023- 24	FY 2024- 25	FY 2025- 26	% Growth
Income from Operations	8,848	10,011	9,509	- 5.0%
Profit before tax	2,960	1,666	1,270	- 23.7%
Profit after tax (after minority interest)	2,197	1,204	993	- 17.5%
AUM	42,070	43,034	63,798	48.3%
Net Worth	11,548	12,432	16,051	29.1%
RoAA (%)	5.1	2.5	2.0	- 25%
RoE (%)	20.7	10.0	7.7	\u2212 23%
Number of Branches	5,286	5,359	5,340	- 0.35%
Total No. of employees	51,004	51,647	42,100	- 18.49%

Standalone Results at a glance (in Crores)

Particulars	FY 2023- 24	FY 2024- 25	FY 2025- 26	% Growth
AUM	28,679	33,021	55,952	69.4%
Gold Loan AUM	20,656	24,658	48,814	98%
Gold Holding (Tons)	56.34	54.20	60.10	10.89%
Live Gold Loan Customers (Million)	2.37	2.44	2.52	3.28%
Gold Loans Disbursed	1,19,084	1,45,290	3,73,832	157%
Capital Adequacy Ratio	30.58	30.91	21.31	- 31.09%
Cost of Fund	8.60	9.21	8.90	- 3.37%
Gross NPA (%)	1.93	2.77	1.80	- 35.71%
Net NPA (%)	1.70	2.43	1.51	- 37.5%
Number of Branches	3,524	3,524	3,524	0%
CV Loans (AUM)	4,111	4,773	2,991	- 37.34%

Key Financial Ratio (Standalone Basis)

Particulars	FY 2023- 24	FY 2024- 25	FY 2025- 26
Return on Net Worth (%)	16.30	14.2	12.20
Basic EPS (after exceptional items)	19.59	21.07	17.99
Interest Coverage Ratio	2.22	2.00	1.67
Current Ratio	1.78	2.20	2.40
Debt Equity Ratio	2.17	2.29	3.18
Operating Profit Margin (%)	41.33	37.32	33.55
Net Profit Margin (%)	28.32	25.79	19.92

Risk Management

In an evolving financial services landscape, effective risk management remains fundamental, supporting long-term stability and growth of Financial Institutions. The Company, a well-established Non-Banking Financial Company in India, operates in a tightly regulated and competitive landscape, exposing it to various operational, financial and external risks. The proactive risk management approach of the Company centers on identifying potential risk exposures, analyzing their impact, defining acceptable risk and implementing appropriate mitigating strategies. This framework is supported by strong governance mechanisms, ongoing monitoring and comprehensive policies, which enable the Company to manage risk across functional areas. By embedding risk considerations into strategic decision-making and everyday operational

execution, the Company strengthens its business resilience while protecting stakeholder interests.

Credit Risk: Credit risk arises from the failure of borrowers to fulfill their repayment obligations, resulting in financial losses. In the Company, this risk is intrinsic to its lending processes, particularly in unsecured portfolios such as Microfinance and MSME financing.

The Company manages credit risk through a product-specific underwriting framework, supported by processes, which include customer profiling, financial analysis, cash flow, credit history evaluation and systematic risk classification. Considering secured products, the current monitoring of collateral adequacy and liquidity parameters is reviewed to ensure sufficient risk coverage. Portfolio diversification strategies are integrated to

minimize concentration risks. Additionally, technology-enabled loan processing and a centralized credit decision framework strengthen governance by mitigating subjectivity and ensuring consistent policy adherence. Early warning mechanisms timely detect stress indicators, instigating proactive interventions by restructuring and focused recovery methods.

Technology Risk: Technology risk arises from the possibility of losses due to failures, disruptions and weaknesses in the Companys information technology environment. This encompasses risks, including system downtime, cyber threats, data compromise, technology obsolescence, and application malfunctions. With the increasing digital platforms across lending, servicing and consumer engagement, it is crucial to scale technology systems to ensure uninterrupted operations and customer experience.

To reduce these risks, the Company continues to maintain a scalable technology infrastructure, designed to reinforce current operations and future growth. IT oversight is monitored through a focused governance framework, responsible for application security, timely technology enhancement, system reliability and vendor oversight. Cyber security remains a core priority in the Company that includes network firewall, encryption standard and intrusion detection. Owing to its current vulnerability assessments, penetration testing and cyber threats surveillance, the Company proactively identifies and mitigates potential exposures.

The Company also establishes comprehensive disaster recovery and business continuity frameworks such as automated data backups, alternate processing facilities and periodic simulation exercises to validate preparedness. Continuous employee awareness of information security reinforces internal controls. In parallel, the Company continuously monitors technology advancements and evolving cybersecurity threats to align its IT strategy with industry-based practices.

Interest Rate Risk: Interest rate risk arises from the potential variations in prevailing market interest rates, impacting the financial position, balance sheet volumes and earnings of the Company. Fluctuating rates can impact interest income and expense, influence the carrying value of assets and liabilities and affect overall profitability across different interest rate cycles.

The Company addresses this risk through a comprehensive Asset-Liability Management (ALM) framework, focused on aligning asset and liability maturities and repricing characteristics to limit timing and rate mismatches. The ALM committee is responsible for periodically reviewing interest rate scenarios, market developments, and calibrating lending strategies accordingly.

Additionally, the Company selectively employs hedging instruments such as interest rate swaps where appropriate, to reduce exposure to rate volatility. Periodic stress testing and sensitivity analysis are conducted to gauge the impact of volatility of the interest rates allowing the Company to formulate appropriate risk mitigation processes and contingency measures.

Operational Risk: Operational risks arise due to potential breakdowns in internal processes, personnel, systems or external factors, adversely affecting business operations. Key sources of such risk include system outages, fraudulent activities, human error or unforeseen events, caused by external activities.

The Company addresses these risks by leveraging technology-driven solutions, simplifying workflows and minimizing manual interventions. A dedicated Internal Audit team periodically reviews operational practices to understand adherence to internal controls while recommending remedial measures, if required. With regular employee trainings focused on operational discipline, fraud risk awareness, and service delivery standards, the Company continues to strengthen its operational resilience.

Liquidity Risk: The Companys possibility to face liquidity risk emerges from its difficulties in meeting financial obligations on time, affecting its cost structure. Such risk may emerge from asset-liability maturity mismatches and unexpected funding requirements or disrupted funding markets.

Maintaining a well-diversified funding mix, drawing resources from banks, debt markets and institutional investors, leads the Company to manage this risk. The Treasury team plays a crucial role in forecasting funding requirements while undertaking forward-looking assessments, ensuring the timely availability of liquidity in business operations.

The Company further implements a structured liquidity risk model, encompassing the maintenance of sufficient liquidity buffers, regular monitoring of cash flows and well-defined contingency funding arrangements. The Asset-Liability Committee is responsible for reviewing key liquidity metrics, providing further guidance on funding and investment actions to maintain economic stability.

Regulatory and Compliance Risk: Regulatory and compliance risk arises from the possibility of business restrictions, disruptions or sanctions, resulting from non-compliance with regulatory directives, industry standards and prevailing laws. Given the evolving regulatory expectations governing Non-Banking Financial Companies, the Company is required to align its operations with evolving legal, supervisory, and governance requirements.

The Company puts forth a comprehensive compliance and governance framework, overseen by a dedicated Compliance team to manage this risk. Policies, control mechanisms and procedures are regularly improved to embed regulatory changes. The Companys automated compliance tool, defined approval process, and real-time monitoring systems ensure timely identification and mitigation of compliance risk.

Regulatory compliance oversight is implemented by the Companys Board of Directors and its Committees, led by regular reviews conducted by Independent Auditors. Ongoing training and awareness programs are conducted to strengthen compliance awareness and ethical conduct in the company.

Reputational Risk: Reputational risk refers to the potential erosion of stakeholder trust, arising from actual or perceived shortcomings in conduct, consumer experience, and governance. Damage to reputation may affect consumer confidence, involve regulatory attention, affecting the Companys funding profile.

The Companys adherence to the well-defined code of conduct, its clearly articulated customer service practices, and transparent disclosures effectively mitigate this risk. To address customer complaints, formal grievance redressal channels are embedded into the Company as a structured feedback process, leading to constant service delivery improvement. With its defined crisis management and communication protocols, the Company addresses reputational concerns promptly. The public relations, communication team, and senior leadership work collaboratively to manage media interactions, ensuring clear and consistent stakeholder engagement.

Competition Risk: Competition risk arises when the Company is unable to execute competitive strategies effectively or respond promptly to evolving market trends. Entering new markets or launching additional financial products without significant preparedness may lead the Company to witness unforeseen operational or strategic challenges.

The Company adopts disciplined strategy planning, reinforced by detailed market analysis, scenario-based assessment and risk-reward evaluation. The major strategic initiatives undergo Senior Managements review and are subject to the Boards approval, maintaining consistency with the Companys long-term objectives and risk tolerance.

Key performance metrics and milestone-based monitoring frameworks track the Companys execution process, supporting early identification of deviations and corrective measures. With the integration of periodic risk reviews into its planning process, the Company recalibrates its strategies in response to changes in the macroeconomic environment.

Asset or Security Risk: Asset or security risk occurs when the value of collateral potentially erodes, impairing the Companys recoverability of outstanding loans. This risk is mostly pronounced in the Companys secured lending products, including gold loans or other asset-backed financing.

The Company follows prudent loan-to-value norms, undertaking regular reviews of collateral valuations to reduce its exposure. In gold loan portfolios, the purity, quality, and prevailing market value of the pledged gold are assessed at the time of disbursement while monitoring over the loan tenure to ensure sufficient collateral coverage.

Additionally, the Company employs stress-testing frameworks to analyze the sensitivity of collateral values to unfavorable market conditions. Based on these assessments, timely collective actions, including revising loan conditions for seeking incremental collateral, are implemented to limit potential losses.

Human Capital Risk: Human capital risk reflects potential misalignment between the Companys people management frameworks and its operation and strategic requirements. This includes risks related to talent acquisition, employee retention, workforce motivation, and leadership continuity.

Succession planning remains the core element in the people strategy of the Company, reinforcing its continuity in key managerial and operational roles. The Company integrates a performance evaluation framework, aligning individual responsibilities with organizational priorities, enabling proactive identification and resolution of performance gaps.

Economic Risk: Economic risk emerges from changes in macroeconomic variables, including inflation, economic growth, labor market conditions and interest rates, affecting the Companys operating environment and profitability.

The Company continuously monitors key economic indicators, incorporating economic outlooks into its planning and risk management methods. Scenario-based evaluations and stress testing are conducted to evaluate the potential effects of unfavorable cycles on the Companys financial strength.

Exposure is reduced through portfolio diversification across industries and geographies, limiting vulnerability to localized economic slowdowns. Additionally, the Company maintains adequate capital buffers and liquidity reserves to withstand economic volatility.

Human Resource Management

Material Developments in Human Resources

Human resources continue to remain a key strength of the Company, supporting its growth and customer service capabilities across its extensive branch network. As of March 31, 2026, the Company had a workforce of 27,248 employees, comprising 23,984 permanent employees, 3,160 probationary employees and 104 contract employees.

During the year, the Company continued to strengthen its people practices through various talent development, employee engagement and digital HR initiatives. The Company maintained its focus on learning and development through structured training programs, higher education support initiatives and digital learning platforms. More than 2,600 employees have participated in company-sponsored higher education programs.

The Company further enhanced its digital HR ecosystem through the implementation of technology-driven platforms such as ZingHR. MADU, the Companys digital learning platform, supported employee learning and skill development during the year, with AI-driven capabilities currently under development to strengthen the learning experience. Continuous efforts were also undertaken to promote diversity, inclusion, employee well-being and workplace engagement through various welfare, recognition and development programs.

The Company remains committed to creating an inclusive, performance-driven and employee-centric work environment that supports both individual growth and long-term organizational success.

Internal Control

The Company has implemented a comprehensive internal control system to promote operational effectiveness, ensure adherence to regulatory requirements and manage risk across its financial services activities. The control framework covers critical functions, including credit appraisal, loan disbursements, collection, finance, compliance, and information technology. With its well-defined organizational structure, led by clearly articulated roles, system-driven controls and documented policies, the Company reinforces its accountability and transparency.

Internal controls are integrated into core business processes through maker-checker mechanisms, approval hierarchies, and automated validations to reduce human errors and prevent unauthorized activities. The Internal Audit functions independently and reports directly to the Boards Audit Committee. The Committee is responsible for periodic risk-focused audits across functional units to analyze controlled adequacy, identify process gaps and puts fourth corrective measures. Corrective actions are monitored to ensure timely closure.

The Company places strong emphasis on internal controls over financial reporting to ensure the accuracy and reliability of financial disclosures. Digital tools and management dashboards facilitate constant monitoring of important operational indicators and exceptions. Periodic training programs are conducted to familiarize employees with control processes and compliance obligations to foster a culture of responsibility. As the business scales and integrates digital solutions, the internal control framework is continuously reinforced to address emerging risks. Overall, the Companys internal control system is proactive, effective and adequate and integral to sustaining operational discipline and stakeholder confidence.

Cautionary Statement

The Management Discussion and Analysis may contain some statements, describing the Companys objectives, predictions, estimates or expectations, which may be forward-looking statements within the meaning of applicable laws and regulations. Actual results may differ substantially or materially from the forward-looking statements contained in this document, due to various risks and uncertainties. These risks and uncertainties include economic and political conditions in India and world at large, volatile interest rates, new regulations, and government policies that may impact the Companys business and its ability to implement the strategy. The Company does not undertake any responsibility to publicly amend, modify, or revise any forward-looking statements, whether as a result of any subsequent developments, latest information, future events, or otherwise.