Mansi Finance Chennai Ltd Management Discussions

Mansi Finance (Chennai) Limited, a Company registered with the Reserve Bank of India as a Non-Banking Finance Company is providing finance and financial services to its clients and customers.

The global economy continued to face a challenging and uncertain environment during FY 2025-26, marked by slower growth momentum, persistent geopolitical tensions, evolving trade policies, and inflationary pressures. According to the International Monetary Fund (IMF), global GDP growth is projected at approximately 2.9%–3.3% for 2026, reflecting moderation from earlier post-pandemic recovery trends.

The IMFs April 2026 World Economic Outlook highlighted that global growth remains uneven across regions, with advanced economies witnessing subdued expansion while emerging economies continue to demonstrate relative resilience. India continues to remain among the fastest-growing major economies, supported by strong domestic demand, public infrastructure investment, digital adoption and financial sector expansion.

Global economic conditions remained vulnerable to several downside risks during FY 2025-26. Escalating geopolitical conflicts, trade fragmentation, tariff-related uncertainties, and energy supply disruptions continued to impact global trade and investment flows. The IMF and various global agencies have cautioned that renewed protectionist measures and geopolitical instability may adversely affect business confidence, investment activity, and cross-border capital flows.

Additionally, volatility in global energy prices and supply chain disruptions contributed to inflationary pressures across several economies, increasing uncertainty in financial markets and impacting emerging economies dependent on external financing and commodity imports.

Global inflation showed signs of gradual moderation during FY 2025-26, although it remained above historical averages in many economies. The IMF projects global headline inflation to moderate from around 4.2% in 2025 toward lower levels over the medium term, supported by easing supply chain constraints and calibrated monetary tightening by central banks.

Major central banks across advanced economies have adopted a cautious monetary policy stance, balancing inflation control with the need to support economic growth. While some economies have initiated gradual policy easing, interest rates continue to remain elevated relative to pre-pandemic levels, thereby impacting borrowing costs and capital flows globally.

The moderation in global economic growth, coupled with continued geopolitical uncertainties and trade disruptions, may lead to tighter liquidity conditions, increased market volatility and cautious investor sentiment. NBFCs may face challenges related to higher funding costs, volatility in foreign capital inflows, and changing credit market dynamics.

Although inflationary pressures have begun to ease globally, interest rate movements remain uncertain across jurisdictions. Any prolonged tight monetary stance in major economies may impact liquidity availability and borrowing costs for financial institutions, including NBFCs. Accordingly, prudent asset-liability management, liquidity planning and diversified funding strategies remain critical.

Despite global uncertainties, India continues to present strong structural growth opportunities supported by stable macroeconomic fundamentals, rising financial inclusion, digital transformation and government-led economic reforms. The domestic financial services sector, particularly NBFCs, remains well-positioned to support credit expansion in underserved and emerging segments.

NBFCs focusing on sectors such as MSME financing, affordable housing, vehicle finance, green financing, infrastructure linked lending and digital financial services are expected to benefit from sustained domestic demand and policy support.

Further, increased adoption of technology-driven underwriting, analytics and digital customer acquisition models continues to create operational efficiencies and enhance scalability.

Your companys net worth on a standalone basis grew significantly by Rs.326.91 Lakhs to Rs.4084.12 Lakhs as of March 31, 2026. The increase in net worth was mainly due to an increase in profit. Your Company has been able to maintain its financial position during the current year. The gross amount of loans provided by the Company stood at Rs.4908.17 Lakhs as on March 31, 2026 as compared to Rs.4807.45 Lakhs as on March 31, 2025. The Companys borrowing has reduced from Rs.2150.01 Lakhs to Rs.1913.58 Lakhs.

The Companys capital to risk weighted assets ratio was 68.82% for the year ended March 31, 2026 as compared to 64.41% for the year ended March 31, 2025.

The Company aims to operate within an effective risk management framework to actively manage all the material risks faced by the Organisation and make it resilient to shocks in a rapidly changing environment. It aims to establish a consistent approach in management of risks and strive to reach the efficient frontier of risk and return for the Organisation and its shareholders.

Broad categories of risk faced by the Company are Credit Risk, Market Risk, Operational Risk and Reputation Risk. The risk management policies are well defined for various risk categories supplemented by periodic monitoring through the various committees of the Board.

Credit Risk: The credit aspects in the Company are primarily covered by the Credit Policy and Delegation of Authority approved by the Board of Directors. The Company measures, monitors and manages credit risks at individual borrower and portfolio level. During the course of the year, we have consistently recalibrated and re-aligned our underwriting criteria with the prevailing market environment across product lines and the associated digital scorecards, significantly leveraging our risk analytics capabilities. This helps us in refining our credit decisioning as well as granular monitoring of our existing portfolio.

Market Risk: Market risk management is guided by clearly laid down policies, guidelines, processes and systems for the identification, measurement, monitoring and reporting of exposures against various risk limits. The Asset Liability Management structure of the Company stipulates a broad framework for liquidity risk management to ensure that the Company is in a position to meet its liquidity obligations.

Operational Risk: The Company has put in place a comprehensive system of internal controls, systems and procedures for documenting, assessing and periodic monitoring of various risks and controls linked to various processes across the organisation.

Fraud Risk: The Company has adopted a robust Fraud Risk Management framework. It has an effective and very strong fraud risk governance mechanism that encompasses controls covering below objectives:

1. Prevent (reduce the risk of fraud from occurring);

2. Detect (discover fraud when it occurs); and

3. Respond (take corrective action and remedy the harm caused by fraud).

Changing business landscape and digitization has heightened the level of fraud risk in the environment arising due to new methods, schemes and technology. We continue to increase our investment in fraud prevention and detection capabilities to protect our stakeholders.

Compliance Risk: The Company has a Board approved Compliance Policy in place which lays down the roles and responsibilities of employees towards ensuring compliance with the applicable laws and regulations as also the role of the Compliance Department in monitoring compliance. The management of compliance risk is an integral component of the governance framework along with other internal control and risk management frameworks.

Reputation Risk: Reputational risk has been defined as the risk arising from negative perception on the part of customers, shareholders, investors, media reports that can adversely affect an organizations ability to maintain existing or establish new business relationships and continued access to sources of funding.

Our governance culture supported by sound risk management is aimed at ensuring we remain resilient during challenging periods and forge a sustainable future for the Organisation.

As of 2025, India has ascended to become the fourth-largest economy globally, with a nominal GDP of $4.19 trillion, surpassing Japan and trailing only the United States, China, and Germany. Projections indicate that India could become the third-largest economy by 2027, underscoring the nations economic momentum. This growth is underpinned by the governments continued emphasis on infrastructure development, private sector capital expenditure, the small and medium-sized enterprise sector. Additionally, rising disposable incomes and a burgeoning middle class are driving consumption across various sectors. Despite these advancements, Indias credit-to-GDP ratio remains on the lower side at approximately 75%, indicating significant room for credit expansion. This gap presents an opportunity for financial institutions to address credit demand, especially as digital public infrastructure matures and credit appetite grows across various customer segments.

The drive to increase financial inclusion is expected to unlock opportunities in underserved and semi-urban/rural markets. Both established and emerging players are increasingly adopting a ‘Phygital approach, combining physical presence with digital capabilities to efficiently serve this new-to-credit customer base. Micro, Small and Medium Enterprises (MSME) sector presents another critical area of growth opportunity. Government initiatives aimed at boosting MSME activity, combined with the sectors difficulty in accessing credit through traditional channels, provide a compelling opportunity for NBFCs to offer customised financing solutions. The ongoing financial inclusion journey in India further amplifies this opportunity, especially through co-lending partnerships with banks, which enable NBFCs to reach broader borrower segments while optimising risk and capital allocation.

The lending industry has also adopted technology and data driven approach to lending in a very encouraging manner. Development of AI based tools for customer identification, evaluation, management, and collection of dues have revolutionized the way the lending industry has been operating. GenAI and Large Language Models (LLM) will be critical for scaling while ensuring a hyper-personalised experience is provided in a cost-effective manner. The emergence of account aggregators (AA) is also democratizing data with the result that credit decisioning can happen in a logical, consistent and fair manner.

Regulatory developments have also played a conducive role in strengthening the sector. The RBI has introduced several guidelines aimed at enhancing consumer protection and promoting responsible lending practices. Notable among these are directives on digital lending norms, guidelines to enhance transparency in multi-lender loan offers involving loan service providers, co-lending framework and increased risk weights on unsecured loans. Such measures are expected to foster innovation while ensuring adherence to high standards of corporate governance and compliance.

The sector also faces certain challenges in terms of elevated funding costs, margin pressures due to competitive lending rates, limited access to funds for smaller NBFCs and the recent uptick in stress in the unsecured loans segment and borrower overleveraging raises concerns about asset quality, necessitating vigilant risk management. From a macroeconomic perspective, the sector remains exposed to external risks, including liquidity constraints, political uncertainties, and fiscal instability. Navigating such volatility requires prudent risk management and diversified funding strategies.

Amidst this landscape, the Company continues to demonstrate robust performance, driven by its commitment to responsible lending, prudent risk management practices and maintaining a diversified liabilities base. The Company is focused on product diversification, strengthening presence in deeper markets and enhancing customer experience. The Company ensures strict adherence to regulatory guidelines, ensuring compliance in both letter and spirit. With a well-articulated strategy, a strong technological foundation, advanced digital and analytical capabilities, a comprehensive risk management framework and a robust collections infrastructure, the Company is well-positioned to capitalize on the opportunities ahead.

Over the past few years, financial services as a sector have observed a positive change in terms of increased regulations and supervision in order to improve transparency and further strengthen the corporate governance. This is also true for NBFCs, as over the years, the sector has undergone considerable evolution in terms of size, complexity and interconnectedness within the financial sector.

The Company operates in single business segment i.e. NBFC, it has witnessed considerable growth in the last few years and is now being recognized as complementary to the banking sector due to implementation of innovative marketing strategies, introduction of tailor-made products, customer-oriented services and simplified procedures, etc.

Your Company is engaged only in lending and investment activities and no other business activities. Hence, the requirement of segment-wise reporting is just for one segment.

The Companys internal control system is designed to ensure operational efficiency, protection and conservation of resources, accuracy and promptness in financial reporting and compliance with laws and regulations. The internal control system is supported by an internal audit process for reviewing the design, adequacy and efficacy of the Companys internal controls, including its systems and processes and compliance with regulations and procedures. Internal Audit Reports are discussed with the Management and are reviewed by the Audit Committee of the Board, which also reviews the adequacy and effectiveness of the internal controls in the Company. The Companys internal control system commensurate with its size and the nature of its operations.

The Companys current activities do not require engagement of significant human resource. However, requisite qualified and experienced personnel have been engaged to take care of organization need of human resource. The Company will engage requisite human resource as and when required.

The future growth of the NBFC sector in India will be shaped by a confluence of factors, including policy support, regulatory oversight, and the continued digitization of the financial value chain. These elements will collectively contribute to the sectors ability to support the broader narrative of Indias economic expansion, making NBFCs indispensable to the nations growth story. In navigating the complexities of the global market landscape, our commitment remains steadfast in delivering sustainable value and preserving shareholder interests. Our lending strategies emphasize security selection, diversification and a balanced approach to capitalize on emerging trends while safeguarding against potential risks.

Statements in the Management Discussion and Analysis that address expectations about the future, including but not limited to statement about Companys strategy for growth, product development, market position, expenditures and financial results are forward looking statements and these forward-looking statements are based on certain assumptions and expectations of future events. The Company cannot guarantee that these assumptions and expectations are accurate or will be realized.

Actual results could differ materially from those expressed or implied. Important factors that could make a difference to the Companys operations, include among others, economic conditions affecting demand/supply and price conditions in global and domestic markets, changes in government regulations, Tax laws and other statutes and incidental factors.