MAS Financial Services Ltd Management Discussions

ECONOMIC OVERVIEW

Global Economy

The global economy in 2025 operated in an uncertain macroeconomic environment, marked by trade restrictions, policy uncertainty and persistent geopolitical tensions.

Europe and Ongoingconflicts the Middle East, including the Russia-Ukraine war, continued to disrupt global supply chains, energy markets and investor sentiment, causing periodic volatility in commodity prices and financial conditions. Rising tariffs and evolving trade arrangements further affected global trade and investment flows.

Despite these headwinds, global economic activity remained resilient, supported by stable labour markets, continued fiscal support and technology-led investments, particularly in artificial intelligence (AI). Diversified trade routes, stronger energy security measures and supply chain realignment supported recovery, with global growth improving to 3.4% in 2025 as compared to 3.3% in 2024.

Advanced economies grew by 1.9%, supported by stable labour markets, easing financial conditions and recovering demand, while emerging market and developing economies

(EMDEs) expanded by 4.4%, driven by resilient domestic consumption, improving manufacturing and services activity, and continued infrastructure investments in key

Asian economies.

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

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 security, inflationary pressures and supply chain stability.and fertilizershaveintensified 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 diversificationand 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 3.1% in CY 2026 and 3.2% 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.

[Source: IMF World Economic Outlook April 2026]

INDIAN ECONOMY

Economic Growth

The Indian economy remained one of the fastest-growing major economies in FY 2026, supported by resilient domestic demand, infrastructure investment and policy reforms. As per the Provisional Estimates released by the Ministry of Statistics and Programme Implementation (MoSPI), real GDP grew by 7.7%, while real Gross Value Added (GVA) increased by 7.9% to 294.91 Lakhs Crores. The services sector remained the primary growth driver, while manufacturing gained momentum through government-led production initiatives and infrastructure spending.

India continued to demonstrate strong macroeconomic resilience, supported by robust domestic consumption, rising public capital expenditure, and sustained private investment. The countrys diversified economic base and structural reforms continued to strengthen long-term growth prospects.

Manufacturing and Industrial Performance

Government reforms and initiatives, including Make in India and the Production Linked Incentive (PLI) schemes, remained key growth enablers. The PLI scheme attracted investments of approximately 2.16 Lakhs Crores across 14 key sectors, supporting the objectives of Atmanirbhar Bharat and Indias vision of becoming a US$ 5 trillion economy.

Manufacturing activity remained robust, with the HSBC India Manufacturing PMI at 55.0 in May 2026, indicating continued expansion in manufacturing activity. The Index of Industrial Production (IIP) grew by 4.9% in April 2026, led by 6.2% growth in the manufacturing sector, reflecting sustained industrial momentum.

Labour Market

Indias labour market remained resilient during FY 2026, supported by continued economic expansion, higher infrastructure spending and improving formal employment opportunities. Employment generation benefited from increased investments in manufacturing, construction and services, while government initiatives promoting skill development, digitalisation and entrepreneurship continued to enhance workforce participation. The countrys large working-age population and favourable demographic profile remain significant long-term growth drivers, supporting consumption demand and strengthening Indias position as one of the worlds largest labour markets.

Global Standing

India remained the worlds sixth-largest economy in nominal GDP terms, with private consumption and investment continuing to drive economic growth. The country also retained its position as the fastest-growing major economy, supported by sustained policy reforms, increasing manufacturing competitiveness and expanding domestic demand. Reforms such as GST, Production

Linked Incentive (PLI) schemes and Make in India 2.0 continued to strengthen formalisation, ease of doing business, manufacturing competitiveness and integration into global supply chains.

India further strengthened its position as a preferred global investment destination, supported by macroeconomic stability, strong foreign exchange reserves, a resilient banking system and sustained infrastructure investments.

Financial Markets and Monetary Environment

Indias financial markets remained stable during the year, supported by healthy banking sector fundamentals,

Theadequate liquidity and continued investor confidence.

Reserve Bank of India maintained a balanced monetary policy approach to support economic growth while ensuring price stability.

Inflation moderated during the year, with the RBI lowering its FY 2026 CPI inflation forecast to 2.1%. The repo rate was cumulatively reduced to 5.25%, supporting credit availability, investments and overall economic activity.

Continued financial sector reforms, increasing digital financial inclusion and expanding credit penetration further strengthened the countrys financial ecosystem.

External Sector and Trade

Indias exports are projected to approach US$ 1 trillion in FY 2027, aided by trade agreements, manufacturing scale-up and improving export competitiveness. Continued efforts to diversify export markets and strengthen domestic manufacturing are expected to further enhance Indias global trade position.

Key Challenges

Geopolitical tensions in West Asia and disruptions to global traderoutesheightenedrisksaroundenergyprices,logistics and the availability of critical industrial inputs. As an import -dependent economy for crude oil and intermediate goods, India remained exposed to higher energy prices, inflationary pressures, supply chain disruptions and commodity price volatility. However, diversified sourcing strategies, stronger domestic manufacturing capabilities and deeper integration with emerging markets continued to support the resilience of the Indian economy.

OUTLOOK

Indias Real GDP growth for FY 2027 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.

Government initiatives such as production-linked incentives (PLI) and continued emphasis on digitalisation are likely to boost investment and productivity across sectors. Initiatives such as Make in India 2.0 will prioritise emerging and high-growth sectors while improving the business environment.

Improvements in the banking and housing finance sectors are expected to further strengthen credit flow financial inclusion. Additionally, expansion in manufacturing and services, alongside increasing formalisation of the economy, is likely to reinforce overall economic momentum.

Indias domestic growth is on an upward trajectory owing to multiple factors such as robust domestic demand, income tax and goods and services tax (GST) rationalisation, softer crude oil prices, Government capital expenditure (CAPEX), alongside facilitative monetary and financial conditions, supported by benign inflation.

Indias Union Budget FY 2027 emphasises public investment by raising the capital expenditure (capex) outlay to a record 12.2 Lakhs Crores. This nearly 9% increase from the previous years estimate of 11.2 Lakhs Crores is intended to sustain economic momentum and fulfil the governments "Viksit Bharat" vision for a developed India. Capital expenditure is prioritised in the budget, with allocations directed towards roads, railways, ports, airports, power transmission and urban infrastructure.

The budget continues to strengthen the banking and credit ecosystem by improving liquidity, enhancing access to finance for MSMEs, and supporting priority sectors such as affordable housing. Additionally, this budget prioritises housing and urban development through a 50% increase in Ministry allocation to 85,522 Crores, focusing on PMAY -Urban, City Economic Regions (CER), and sustainable infrastructure.

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

INDUSTRY OVERVIEW

Financial Services Industry

Indias financial services sector recorded steady growth during FY 2026, supported by expanding credit, digital financial services, and greater formal banking access.

Growth was driven by resilient domestic consumption, financial inclusion, rising Retail and MSME financing, and wider adoption of digital lending and payment platforms. Despite geopolitical tensions, commodity price volatility, and evolving monetary conditions, the sector remained resilient due to effective RBI regulation, healthy capitalisation, and stronger balance sheets of Banks and NBFCs.

The financing market comprising Scheduled Commercial Banks (SCBs) and NBFCs continued to expand. SCB credit growth accelerated to 15.9% from 10.9% in the previous year, with aggregate credit outstanding reaching 212.9 Lakhs Crores, an increase of 29.2 Lakhs Crores. Credit growth remained broad-based, led by services (19.0%), supported by lending to NBFCs, trade and commercial real estate, while industrial credit grew 15.0%, agriculture 15.7%, and personal loans 16.2%, reflecting healthy economic activity, private investment, and consumer demand.

Technology-led transformation gathered pace through

AI-driven solutions, fintech innovation, and Digital Public Infrastructure. Initiatives such as the Unified Lending Interface (ULI) and Account Aggregator (AA) framework enabled faster, secure and personalised credit delivery.

Growth in cross-border digital payments, fintech integration, and regulatory focus on cybersecurity, digital resilience, and multi-currency payment systems further strengthened the ecosystem.

Indias digital payments ecosystem continued to expand, led by UPI. During FY 2026, UPI processed over 24,162 Crores transactions worth approximately 314 Lakhs Crores, registering 30.0% growth in volume and 20.6% growth in value. UPI accounted for nearly 85% of Indias digital payment volumes and around 49% of global real-time payment transactions, with participation from over 700 banks, supported by QR-based payments, merchant acceptance, rural penetration, and cross-border adoption.

The RBIs Financial Stability Report (December 2025) indicated stable capital adequacy, liquidity and profitability, while Gross Non-Performing Assets (GNPA) continued to improve. Meanwhile, the BNPL market is projected to expand from US$ 30 billion in 2025 to US$ 78 billion by 2030. Revised RBI co-lending guidelines are also expected to strengthen bank-NBFC partnerships, improve risk sharing, and support sustainable Retail and MSME credit growth.

(Source: PIB)

NBFCs in India

Indias Non-Banking Financial Company (NBFC) sector continued to play a vital role in credit delivery during

FY 2026, particularly across retail finance, MSME lending, vehicle finance, gold loans, housing finance, and rural credit. By extending credit to underserved, semi-urban, and rural markets, NBFCs strengthened financial inclusion and reinforced their position within Indias retail lending ecosystem. Sector credit expanded by approximately 13 15% during FY 2026, while NBFC credit recorded 16.7% year-on-year growth. Retail assets remained the primary growth driver, accounting for nearly 57% of the sectors credit portfolio.

The gold loan segment emerged as a key growth driver, supported by rising gold prices, higher collateral values, and increasing borrower preference for secured credit.

NBFCs were the fastest-growing lender category in this segment, recording nearly 213% year-on-year growth in disbursements, significantly outpacing public and private sector banks. Their extensive customer reach and quick disbursement capabilities continued to strengthen their competitive position.

NBFCs also maintained leadership in the personal loan segment, accounting for 91.3% of origination volumes and 39.8% of origination value during FY 2026. Their strong presence in low-ticket and digitally originated loans continued to improve credit access for new-to-credit and underbanked customers. In the two-wheeler loan segment, NBFCs further strengthened their market position through integrated financing models, streamlined underwriting, and deeper penetration across underserved customer segments.

NBFCs also retained dominance in the consumer durable loan market, accounting for 85% of origination value and

88% of origination volume during FY 2026. Their leadership was supported by efficient distribution networks, quick disbursements, Buy Now Pay Later (BNPL) offerings, and point-of-sale financing models, while private banks share declined to 12.1% of value and 10.9% of volume.

The sectors structural strengths include faster turnaround time, specialised underwriting, digital onboarding, localised customer service, and strong presence across

Tier II, Tier III, and rural markets. During FY 2026, the RBI also introduced regulatory reforms, including rationalised classification norms, simplified branch expansion, and reduced compliance requirements for smaller NBFCs, supporting sustainable sector growth.

The evolving shift towards digitisation, 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, personalised offerings and data analytics. Overall, NBFCs continue to remain well-positioned by greater financial inclusion and long-term economic development.

(Source: Crifhighmark, BFSI, KNN India, BFSI,

CRIF HIGH MARK)

MSME Sector

The Micro, Small, and Medium Enterprises (MSME) sector remains a cornerstone of Indias economy, increasing substantial employment, exports, and industrial output. As of 2026, registrations on the Udyam Portal had crossed 7.83 Crores enterprises, creating livelihoods for 32.82 Crores people, and representing nearly 49%% exports in FY 2026. Acknowledging the industrys economic relevance, the Union Budget 2026-27 has initiated a set of forward -looking measures to strengthen capacity, enhance access to resources, and bolster MSMEs long-term growth.

The Union Budget 2026-27 places strong emphasis on strengthening the MSME sector through a combination of financial support, ease of doing business reforms, and enhanced competitiveness. The Government has introduced a "Creating Champion MSMEs" strategy, aimed at enabling MSMEs to scale, innovate, and integrate into global value chains, with 10,000 Crores SME Growth Fund and 2,000 Crores top-up to Self-Reliant India Fund.

Measures to strengthen the Trade Receivables Discounting System (TReDS), including its integration with platforms such as Government e-Marketplace (GeM), are expected to improve working capital access and receivables financing. The Government has emphasised regulatory simplification, digital trade facilitation, and trust-based compliance frameworks. It has also introduced initiatives such as Corporate Mitras in Tier-II and Tier-III cities to support compliance and operational efficiency.

(Source: PIB, IBEF)

Housing Finance

Indias housing finance industry recorded stable growth during FY 2026, supported by urbanisation, rising household incomes, favourable demographics, and continued policy support for affordable housing. The sector remained a key 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 Lakhs Crores in 2025, registering around 10% year-on-year growth. HFCs recorded nearly 12% credit growth, while Assets Under Management (AUM) increased by around 15% to approximately 9.8 Lakhs Crores, supported by sustained demand from salaried, self-employed, and affordable housing borrowers. Total HFC disbursements also grew 19.5% year-on-year, reinforcing their role in last-mile credit delivery.

Demand continued to strengthen across semi-urban and emerging markets, driven by wider lender presence, improved digital underwriting, and better access to formal credit. Housing loans as a percentage of GDP increased from around 8% in FY 2015 to approximately 11% in FY 2025, reflecting deeper mortgage housing finance market is estimated at approximately US$ 430.74 billion in 2026 and is projected to reach US$ 809.07 billion by 2031, growing at a 13.44% CAGR.

The interest rate environment remained supportive, with the RBI maintaining a moderately accommodative stance and reducing the repo rate to around 5.25% during

FY 2026. Stable borrowing costs supported affordability and housing demand, although lenders continued to follow prudent underwriting amid evolving macroeconomic conditions and moderating retail credit growth.

Public sector banks retained a dominant position in housing finance, while private banks expanded through digital capabilities and faster processing. HFCs continued to focus on affordable housing, self-employed borrowers, and underserved segments. Affordable Housing Finance Companies (AHFCs) reported nearly 19% growth in AUM to approximately 1,58,449 Crores during FY 2026. The sector maintained healthy capitalisation, diversified funding, and stable asset quality, with HFC GNPA remaining around 1.7%. Industry AUM growth is expected to normalise to a sustainable 20% by FY 2027.

(Source: PIB, Prsindia, ICRA, Careratings, NHB, Economic Times,)

Automobiles

Indias automobile industry recorded its highest-ever annual sales across all major vehicle categories during FY 2026, supported by strong consumer demand, favourable policy measures, lower financing costs, and improving economic activity. According to thelatestdatareleased and increasing adoption 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 46.43 Lakhs during FY 2026, 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 9.05 Lakhs units supported by steady demand from the Middle East, Africa, and Latin America.

The two-wheeler segment recorded its highest-ever annual sales of 217.1 Lakhs units in FY 2026, reflecting growth of 10.7% over the previous year and surpassing the earlier peak achieved in FY 2019. 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 51.8 Lakhs units 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 10.8 Lakhs units during FY 2026, registering growth of 12.6% compared to FY 2025. 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 Commercial vehicle exports increased by 17.4% during the year to around 1 Lakh units.

Three-wheeler sales also reached a record level of 8.4

Lakhs units in FY 2026, 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 28.3 Lakhs units during FY 2026, reflecting strong manufacturing activity and sustained domestic demand. The industry also benefited from improving macroeconomic conditions, rising consumer confidence, 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.

According to the industry guidance from SIAM, growth across automobile segments is projected to remain sustained in FY 2027, building on the momentum generated in recent years. A resilient macroeconomic environment, continued government investment in infrastructure, and supportive policies are likely to enhance demand. A normal monsoon in 2026 is expected, further strengthening economic activity in rural and semi-urban regions, offering incremental support to vehicle sales. Additionally, the Union Budget 2026-2027 focuses on accelerating the EV ecosystem and manufacturing localisation, allocating 5,939.87 Crores for the Auto PLI scheme.

(Source: SIAM)

COMPANY OVERVIEW

Established in 1995 with a clear focus on extending credit access for underserved and unbanked communities, MAS Financial Services Limited (MAS) is a well-recognised Non-Banking Financial Company (NBFC), regulated by the Reserve Bank of India (RBI). The Company, based in Ahmedabad, completed 30 years of operations in FY 2026, and is steadily advancing its commitment to financial inclusion through delivering structured, scalable, and responsible financial solutions across urban, semi-urban, and rural markets in India.

MAS has built its well-established lending franchise, supported by over three decades of operating experience, and caters to the evolving needs of low and middle-income borrowers. Its lending portfolio encompasses Micro Enterprise Loans, Small & Medium Enterprise Loans, Two-Wheeler Loans, Commercial Vehicle Loans and Salaried Personal Loans. Additionally, the Company provides affordable housing finance through its wholly owned subsidiary, MAS Rural Housing & Mortgage Finance Limited (MRHMFL).

Distribution Network

MAS follows a diversified distribution strategy, combining its own branch network with strong partnerships across the NBFC ecosystems. The Company operates through

208 company-owned branches and collaborates with around 224 active NBFC partners. Together, this network serves more than 13 Lakhs active loan customers across over 16,500 locations in 13 states and union territories. The Company leverages a well-balanced distribution model comprising its Direct Retail Distribution and Retail

Asset Channel, enabling it to effectively expand its reach while maintaining prudent risk diversification.

With this blended distribution approach, the Company is enabled to provide last-mile access to credit, while efficiency and minimising credit supporting operational and concentration risks.

Collaborations with NBFCs and MFIs

MAS has developed a long-standing association with a wide network of NBFC and MFI partners, offering them capital support, operational expertise, and a shared approach to credit risk management. This partnership-based sourcing model enables the Company to expand into underserved regions while ensuring balanced business growth without concentrating on a single counterparty.

As of March 31, 2026, MAS maintained connections with approximately 224 NBFCs and MFIs, 544 sourcing associates in the commercial vehicle loans and 135 intermediaries in the two-wheeler loans segment supported the Company.

To continue pursuing the objective of being a highly efficient financial services distributor, the Company consistently strengthens its credit frameworks, leverages technology, and refines operational processes.

BUSINESS PERFORMANCE

Business Performance

A diversified lending portfolio range enables MAS Financial Services to address the financial requirements of underbanked and underserved low and middle-income segments in India. The Company delivers carefully structured credit solutions, supporting small businesses, strengthening income generation, and advancing financial inclusion across urban, semi-urban, and rural regions.

As of March 31, 2026, the reported Assets Under Management (AUM) stood at 14,363.67 Crores, registering a year-on-year growth of around 19%. Micro-enterprise and SME loans continued to constitute the core of the portfolio, complemented by a well-diversified mix of two -wheeler, commercial vehicle and salaried personal loans.

Asset quality remained stable, with net Stage 3 assets at 1.70%, highlighting disciplined credit appraisal and structured risk management frameworks. Owing to its strong capital position, the Company maintained a 22.84% capital adequacy ratio, including Tier I capital of 21.50%, offering adequate headroom for future growth.

Micro Enterprise Loans (MEL)

Micro Enterprise Loans (MEL) remains a cornerstone of MASs lending portfolio, serving borrowers across over 190 business types, such as small retailers, local manufacturers, service providers and traders. The loan sizes generally range from 0.50 Lakh to 10 Lakhs and are intended to support the creation of sustainable livelihoods and income generation across the informal and semi-formal sectors.

In FY 2026, the Company disbursed MEL amounting to 6,366.47 Crores. As of March 31, 2026, the MEL book recorded 5,737.79 Crores in AUM, representing a 19.70% year-on-year growth compared to the previous year.

Small and Medium Enterprise (SME) Loan

The SME lending portfolio emphasises addressing the growth, expansion and working capital requirements of small and medium-sized enterprises across manufacturing, trading, and service sectors. Loan amounts generally range from 10 Lakhs to 5 Crores and are deployed for asset acquisition, machinery purchases and working capital for everyday operations.

In FY 2026, the Company disbursed 4,422.51 Crores under the SME financing segments. As of March 31, 2026, the SME loan book earned 5,212.99 Crores in AUM, with a 15.78% year-on-year growth.

TWO-WHEELER AND COMMERCIAL VEHICLE LOANS (WHEELS PORTFOLIO)

MAS Financial Services Wheels portfolio comprises Two-Wheeler and Commercial Vehicle Loans, supporting mobility needs and livelihood opportunities, particularly across underpenetrated and rural regions.

Two-Wheeler Loans

The Company provides two-wheeler loans to a wide range of borrowers, including farmers, professionals, small entrepreneurs and salaried customers. These loans are mostly concentrated in rural and semi-urban areas, with typical loan sizes ranging from 25,000 to 1.50 Lakhs. Through enhancing last-mile access, two-wheeler financing supports

In FY 2026, under the two-wheeler loan portfolio, MAS disbursed 965.59 Crores. As of March 31, 2026, the AUM for this segment stood at 1,063.33 Crores, with a 35.43% year-on-year growth

Commercial Vehicle Loans

MAS primarily expands commercial vehicle loan for pre-owned vehicles, with ticket sizes typically ranging from 1 Lakh to 15 Lakhs. These loans are aimed at supporting individuals and small enterprises engaged in logistics, transport and distribution, aiding them in improving operational efficiency and productivity. In FY 2026, under the commercial vehicle loan segment, the Company disbursed 844.58 Crores. As of March 31, 2026, the AUM for this portfolio grew to 1,085.73 Crores, with a 10.86% year-on-year growth.

SALARIED PERSONAL LOANS

To diversify its retail loan portfolio, MAS entered the Salaried Personal Loans segment in FY 2023. This segment addresses the personal financing requirements of salaried customers, bolstering its participation in consumption-led credit. With an intention to meet short-term personal and household needs, the Company offers a loan amount of up to 5 Lakhs to employees of approved organisations. Since its inception, the financing segment has gained a positive customer response.

In FY 2026, the Company disbursed 1,484.07 Crores in Salaried Personal Loans with AUM reaching 1,263.82 Crores as of March 31, 2026, with a 21.58% year-on-year growth. This growth is attributed to lower base, strong customer acceptance and targeted scaling through strategic partnerships and direct sourcing.

Housing Loans

MAS Rural Housing & Mortgage Finance Ltd. (MRHMFL), a subsidiary of MAS Financial Services, operates as a registered with the National housing finance Housing Bank. MRHMFL, incorporated in 2008, provides affordable housing finance to low and middle-income households. The company targets semi-urban and rural markets, where formal housing credit access remains limited.

MRHMFL offers financing for residential purchases, construction, renovation, and acquisition or development

Assets Under Management - by Product Category of small commercial property. Additionally, the subsidiary provides project finance to developers engaged in developing affordable housing projects. In FY 2026, MRHMFL issued loans amounting to 295.67 Crores, reinforcing the Companys broader objective of ensuring inclusive and responsible credit access.

As of March 31, 2026, the AUM for MRHMFLs business stood at 940.19 Crores as compared to 768.09 Crores as of March 31, 2025.

FINANCIAL HIGHLIGHTS ( in Crores)

	Standalone	Standalone	Consolidated	Consolidated
Particulars	Year Ended on	Year Ended on	Year Ended on	Year Ended on
	March 31, 2026	March 31, 2025	March 31, 2026	March 31, 2025
Revenue from Operations	1,894.51	1,518.16	1,995.43	1,597.45
Other Income	5.82	2.29	6.84	2.7
Total Income	1,900.33	1,520.45	2,002.27	1,600.15
Total Expenditure	1,407.26	1,110.02	1,492.46	1,179.14
Profit before exceptional items and tax	493.07	410.43	509.81	421.01
Exceptional items	(4.24)	0.00	(4.82)	0.00
Profit Before Tax	488.83	410.43	504.99	421.01
Provision for Taxation (Including	125.18	104.50	129.17	107.03
Current Tax, Deferred Tax & Income
Tax of earlier Years)
Net Profit	363.65	305.93	375.82	313.98
Profit Brought Forward	1,062.73	845.91	1,069.20	850.75
Profit attributable to minority			(4.61)	(3.60)
shareholders
Effect of changes in the Groups interest			(15.57)	(1.12)
Item of other comprehensive income recognised directly in retained earnings - on defined benefit plan	(0.13)	(0.55)	(0.15)	(0.56)
Profit Available for Appropriation	1,426.25	1,151.29	1,424.69	1,159.45
APPROPRIATIONS:
Transfer to reserve u/s 45-IC of RBI Act, 1934	(72.73)	(61.18)	(72.73)	(61.18)
Transfer to reserve u/s 29-C of NHB Act, 1987			(2.49)	(1.67)
Final Dividend on Equity Shares	(12.70)	(9.24)	(12.70)	(9.25)
Interim Dividend on Equity Shares	(22.68)	(18.14)	(22.68)	(18.15)
Surplus Balance carried to	1,318.14	1,062.73	1,314.09	1,069.20
Balance Sheet

Details of significant changes in Key Financial Ratios

During FY 2026, therewerenosignificantchanges (changes exceeding 25% or more as compared to the immediately previous financial year) in Key Financial Ratios

Details of changes in Ratios

On a standalone basis, during FY 2026, the Debt Equity Ratio was 3.31 times in FY 2026 as compared to 3.37 times for FY 2025. The Interest Coverage Ratio was 1.57 times in FY 2026 as compared to 1.57 times for FY 2025. The Companys return on net worth stood at 14.36% in FY 2026* as compared to 14.11% for FY 2025.

*Excludes the one-time impact of 4.24 Crores of estimated provisions (considered in Q3FY26) pursuant to the new Labour Codes

LIABILITY MANAGEMENT

MAS Financial Services recognises effective liability management as a critical part of its overall business strategy. With its conservative and well-structured approach, the Company manages industry cycles, complies with regulatory requirements and maintains steady access to loans for a diversified lender base.

Over time, MAS continues to maintain an enduring relationship with leading financial institutions. The Company constantly has a track record in prudent fund utilisation, disciplined financial management and a long -term focus on stakeholder value creation.

Through managing its asset-liability framework actively, the Company ensures an optimal mix of funding sources, such as term loans, cash credit, debentures and direct assignment. The varied funding approach enables cost control, aligns asset-liability maturities, and mitigates liquidity risk.

As of March 31, 2026, total borrowings recorded 9,762.42 Crores. Approximately, 85% of the loan portfolio qualifies under Priority Sector Lending (PSL), enhancing the Companys attractiveness to institutional lenders. Additionally, MAS sustains a robust off-book portfolio through non-recourse, door-to-door co-lending and direct assignments. With an aim of supporting capital efficiency and liquidity strength, the Company maintains off-book assets in the range of 20% to 25% of the total AUM.

Owing to its structured and disciplined liability management framework, MAS reflects its growth strategy and ability to generate sustainable returns. The Company accesses cash credit facilities with a total sanctioned limit of approximately 1,534 Crores across 14 banking relationships. Utilisation remains steady at 70% to 75%, ensuring ample liquidity headroom.

As of March 31, 2026, the Company maintained an average liquidity of nearly 1,000 Crores, along with unutilised cash credit lines of about 200 Crores. MAS holds sanctioned but undrawn funding lines of nearly 2,000 Crores across term loans, non-convertible debentures, direct assignments, and co-lending arrangements. These undrawn commitments prepare for expansion, providing liquidity buffers.

In the Companys assessment of a comprehensive structural liquidity assessment as of March 31, 2026, no liquidity mismatches were indicated. Through multiple liquidity stress tests under different scenarios, the ability of the company to comfortably address its debt servicing obligations is confirmed. Owing to its disciplined liquidity and capital planning, the Company remains well positioned to confront external shocks, reinforce business expansion and provide long-term stakeholder value.

RESOURCE MOBILISATION

MAS Financial Services integrates a disciplined and well-diversified funding strategy to reinforce balance sheet stability, effective asset-liability management and competitive funding cost. The Company strengthens mixfunding flexibility of equity, long-term borrowings, structured off-balance -sheet funding and market instruments.

Share Capital

As of March 31, 2026, the Companys paid-up equity share capital recorded 181.45 Crores, represented by 18.15 Crores equity shares of 10 each. The existing capital base supports current operations while retaining adequate flexibility to find

Term Loans and access The Company raised approximately estor group. 3,150Croresthrough new term loan facilities, from a broader range of banking institutions in FY 2026. On average, these loans carried a tenure of nearly 4 years, highlighting the Companys emphasis on aligning funding tenure with asset duration while maintaining a prudent Asset-Liability Management (ALM) framework.

Loan Portfolio Assignment/Co-Lending

In FY 2026, the Company continued to scale its off-balance-sheet strategy by direct assignment and co-lending arrangements. Transactions under these structures recorded 3,000 Crores for the year. Such partnerships enhance effective capital deployment, strengthen balance sheet uses and optimise wider credit outreach, particularly across semi-urban and rural geographies.

Non-Convertible Debentures (NCDs)

expansion initiatives. As part of its strategy to broaden funding sources and secure longer-term capital, the Company raised nearly 1,000 Crores through issuing Non-Convertible Debentures (NCDs)in FY 2026. NCDs remain an integral part of MASs tofunding model, offering structural flexibility adiversified

DURING THE YEAR, THE RATING AGENCIES REAFFIRMED/ISSUED/UPGRADED RATINGS OF VARIOUS FACILITIES TO THE COMPANY, AS UNDER

CAPITAL MANAGEMENT

MAS Financial Services follows a disciplined and well-defined capital management framework to ensure business growth while preserving balance sheet strength and regulatory compliance. Aligning with the norms and guidelines prescribed by the Reserve Bank of India (RBI), the Company seeks to optimise returns on deployed capital while maintaining adequate capital buffers to support future business expansion.

Owing to its disciplined approach to capital deployment, the Companys operations remain sufficiently capitalised, as reflected in its Capital Adequacy Ratio (CRAR) of 22.84%, including Tier I capital of 21.50% as on March 31, 2026, determining scalable growth without diluting risk controls.

A strong balance sheet, supported by a calibrated mix of internal and external capital, reinforces the Companys long-term financial resilience and stakeholder value creation. The Company continues to maintain a diversified borrowing profile with funding support from 44 lending institutions, enabling prudent liability management, competitive cost of funds and adequate liquidity to support its growth plans. This integrated approach reinforces long-term financial resilience and positions the Company to absorb economic dynamics while preparing to fund future growth opportunities. Backed by a strong capital base and healthy leverage levels, the Company remains well positioned to pursue its medium-term growth strategy without any immediate requirement for additional equity capital, while continuing to maintain prudent risk management and regulatory compliance.

CREDIT AND RISK MANAGEMENT

Risk management is central to MASs operating approach. The Company acknowledges that effective risk assessment, and mitigation are critical to identification, safeguard its assets and ensure long-term sustainability.

Risk may originate from internal and external factors, and to address this effectively, MAS has put in place a proactive risk management framework.

The Company articulates its risk tolerance framework through clearly established policies, control mechanisms, and key risk indicators (KRIs), with regular reviews. The enterprise-wide risk model is strengthened by formal risk assessments and a comprehensive risk register, promoting a strong culture of risk awareness across the organisation.

MAS follows a product-specific credit assessment approach, aligned to customer profiles,loan purposes and exposure limits. A blend of internal analytics, an adaptive credit scoring model, and bureau data manages the companys credit risk. The Company continues to strengthen its underwriting capabilities through enhanced digital platforms, including its Loan Origination System (LOS), Business Rule Engine (BRE), and advanced analytics to improve credit decision-making and operational efficiency. Credit and collections teams operate in close coordination to manage delinquencies, monitored on an ongoing basis by senior and middle management.

As of March 31, 2026, the Companys Gross Stage 3 assets stood at 2.57% and Net Stage 3 assets remained 1.70% of total AUM. The portfolio continued to be characterised by short-term loans with an average tenure of about

17 months per year. Prudent spread management, short-tenure lending, and periodic repricing mitigate interest rate and credit risk.

Owing to its well-diversified borrower base across and within business segments, MAS covers a wide spectrum of sectors and customer profiles. The diversity cushions the portfolio against market fluctuations and economic stress. The Company closely monitors macroeconomic developments, adjusting its operating strategies as required, to safeguard asset quality and continuity of operations.

OPPORTUNITIES AND THREATS

MAS Financial Services integrates a continuous and forward-looking approach to monitoring its operations.

This enables the Company to unlock growth opportunities earlier while managing potential risks. Such vigilance enhances strategic responsiveness, reinforcing sustainable performance in an evolving market.

Opportunities .

MAS is well placed to capitalise on opportunities within a competitive yet growing financial services sector. Owing to its pan-India presence, diversified lending and strong engagement with low-and middle-income customer segments, the Company gains a strong platform for future growth. The partnership-driven model improves scalability through optimising operating costs, distributing credit risks and ensuring last-mile access.

The Company is well-positioned to pursue its medium and long-term growth objectives, reinforced by its strong capital base. With its strengthened brand recall among underserved customer segments, the Company improves access to organised credit. Ongoing policy emphasis on MSME growth and financial inclusion further improves MASs operation and supports its standing as a reliable credit provider.

Threats

Operating in an evolving regulatory and competitive landscape, MAS witnesses risks that include changes in policies, increased competition from domestic and international businesses, and exposure arising from lending to semi-formal and informal customers. The Company remains vigilant to these strategies, focusing on constant refinements of factors, maintaining underwriting standards and controlling risk.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

To safeguard assets, ensure regulatory compliance, and maintain operations across its growing business, MAS has implemented a well-defined internal control framework. The Companys clearly defined authority, documented procedures and layered controls govern key activities across the credit life cycle.

Credit assessment is driven by customer data, risk-based underwriting standards and tailored scorecards. Through applying these frameworks consistently and refining them periodically, the Company reflects market changes. Core principles of responsible lending remain in place even as risk filters and assessment tools evolve.

MAS continues to reinforce its monitoring processes, particularly for partner-led NBFC arrangements. Exposure limits, due diligence frameworks, and audit trails are reviewed regularly. Operating costs are closely tracked, while process improvements and technology enablement emphasisetheCompanys

The audit committee of the board actively oversees the

Companys internal control framework. It reviews audit observation, tracks corrective actions and evaluates the effectiveness of the Companys risk management practices and policy compliance. Through functioning independently, the internal audit evaluates operational efficiency, accuracy of financial reporting and compliance with regulatory norms. The Company ensures that its governance framework is aligned with business growth and the changing risk environments through strengthening its systems and controls.

HUMAN RESOURCES

MAS Financial Services recognises the importance of its workforce in its growth strategy. The Company believes that its skilled and engaged people are critical to sustaining long-term performance and delivering on its mission. Keeping this in consideration, MAS strives to provide its employees with a positive and inclusive workplace, encouraging high performance while enabling employees to grow professionally and personally.

The organisation fosters a culture rooted in accountability, mutual respect and credibility. Moreover, this environment promotes collaboration, reinforces employee engagement and enhances employee retention. Through encouraging ownership and leadership across all levels, MAS encourages teams to contribute meaningfully to organisational outcomes.

Human resource practices are periodically reviewed to remain aligned with changing business priorities. A structured talent management model, covering capability building, career progression, and performance-based recognition, is put in place by the Company. Concurrently, learning and organisational development initiatives emphasise constant enhancement and leadership development suitable for a changing landscape of financial services.

Senior leadership contributes largely to shaping strategy and execution. Through mentorship and close involvement, ensuring continuity, clarified direction and the deep expertise, experienced leaders guide teams across organisations.

As of March 31, 2026, MASs standalone employee strength stood at 1,933. The Company focuses on developing a resilient and future-ready workforce, supporting its commitment to inclusive financial services across India.

OUTLOOK

The Company remains well positioned to capitalise on the strong growth trajectory of the NBFC sector, driven by increasing credit demand across MSMEs, retail borrowers, and underserved segments. With a long-standing focus on granular lending, risk-calibrated growth, and deep customer understanding, the Company expects to sustain stable portfolio performance while expanding its presence across geographies and product segments. The Company remains focused on delivering sustainable and profitable growth trajectory of around 20 25%, while maintaining its disciplined underwriting standards, healthy asset quality and robust profitability. Its continued emphasis on direct distribution, supported by branch expansion and improved sourcing mix, is expected to enhance operating leverage and strengthen long-term profitability.

Going forward, the Company aims to pursue a balanced growth strategy, combining direct lending with its established NBFC partnership model, while gradually increasing the share of its retail portfolio. The Retail Asset Channel (RAC) is expected to grow in a calibrated manner, contributing to diversification and resilience, with NBFCs continuing to play a critical role in credit distribution and financial inclusion. The Company also expects its housing finance business to continue gaining scale, further strengthening its diversifiedlending portfolio. The Companys focus on underserved markets, supported by strong monitoring frameworks, continued investments in digital capabilities, AI-enabled analytics, Loan Origination Systems (LOS) and Business Rule Engine (BRE) platforms, technological integration, and disciplined risk management, positions it to benefit from the structural growth opportunities in Indias consumption-led and MSME-driven economy. Backed by a strong capital position, diversified funding profile and prudent liability management, the Company is well placed to capitalise on emerging opportunities while preserving its long-standing focus on asset quality, return ratios and shareholder value creation.

CAUTIONARY STATEMENTS

This document contains statements about expected future events, financial and operating results of MAS, which are forward-looking. By their nature, forward-looking statements require the Company to make assumptions and are subject to inherent risks and uncertainties. There is a significant risk that statements will not prove to be accurate. Readers are cautioned not to place undue reliance on forward-looking statements, as several factors could cause assumptions, actual future results, and events to differ materially from those expressed in the forward-looking statements. Accordingly, this document is subject to the disclaimer and qualified in its entirety by the assumptions, qualifications and risk factors referred to in the managements discussion and analysis of the Companys Annual Report FY 2026.