Money Masters Leasing & Finance Ltd Management Discussions

For the Financial Year 2025-26

A. Indian NBFCs

Money Masters Leasing & Finance Limited (the Company) is a Non-Deposit Accepting NBFC- Investment and Credit Company-Base Layer (NBFC-ICC-BL) registered with the Reserve Bank of India (RBI). It is classified as an NBFC-Investment and Credit Company Base Layer (NBFC-ICC-BL) with the RBI. The Company is engaged in the business of lending, with a diversified financing portfolio focused mainly on hire-purchase loans for vehicles, auto rickshaws, equipment, and small-ticket assets, thereby contributing to financial inclusion.

B. Industry Overview

The NBFC sector continues to play a vital role in the Indian financial system by complementing the banking sector and serving segments often under-served by banks. During FY 2025-26, the overall NBFC sectors Assets under Management (AUM) is estimated by industry sources (ICRA/CRISIL) to have grown at approximately 15-18% year-on-year, moderating from the sharper 18% expansion registered in NBFC-Retail AUM during FY 2024-25. Industry estimates place the sectors overall AUM at approximately 48-50 lakh crore ( 48-50 trillion) as at 31 st March 2026, building on the sector having crossed the 50 lakh crore mark (on a wider base including Housing Finance Companies) during FY 2024-25. The moderation in growth during the year under review reflects a broader industry-wide normalisation following the sharper post-Covid expansion of FY 2023-24 and FY 2024-25, along with continued caution around unsecured lending segments such as microfinance and personal loans. Industry estimates project the sectors overall AUM to cross 50 lakh crore (on a comparable basis) during FY 2026-27, supported by continued momentum in retail, MSME, vehicle, and gold loan financing.

Growth continues to be driven by robust demand in the unsecured lending segment (personal loans, consumption loans, and MSME financing) and steady momentum in vehicle/equipment financing, with a particular uptick in electric vehicle (EV) and two-wheeler financing demand, reflecting the broader shift towards affordable green mobility solutions in semi-urban and rural markets.

NBFCs continue to benefit from their strong customer connect, faster processing, and ability to customize products as compared to banks.

Regulatory focus during the year continued on governance, digital lending norms, and expected credit loss (ECL)-based provisioning under Ind AS, with continued emphasis by RBI on strengthening the resilience of smaller NBFCs.

Growth Drivers for NBFCs:

Demand for loans by MSMEs, who often face difficulties in accessing credit from traditional banks due to stringent eligibility criteria.

Rapid adoption of digital lending platforms, enabling quicker loan disbursement and improved customer experience.

Government push for infrastructure, rural development, and mobility, driving demand for asset financing.

While NBFCs have witnessed steady growth, the sector also faces challenges such as rising borrowing costs, competition from banks and fintechs, and continuing regulatory change.

C. Performance Review

The Company is engaged in the business of Hire-Purchase finance. A summary of the Companys performance for FY 2025-26 as compared to the previous year is set out below:

Particulars	FY 2025-26 ( in lakhs)	FY 2024-25 ( in lakhs)
Net Receipts from Operations	151.33	214.13
Profit After Tax (PAT)	35.67	51.19

D. Risk Factors

The Company is exposed to a variety of risks, which are actively monitored and managed:

Financial Risks: Fluctuations in interest rates, liquidity availability, and market volatility.

Credit Risk: Delinquencies in the borrower portfolio, particularly in economically weaker segments.

Liquidity Risk: Smaller NBFCs often face funding challenges due to limited refinancing avenues and higher borrowing costs.

Regulatory Risks: Frequent policy changes by RBI relating to capital adequacy, provisioning norms, digital lending, and governance.

Macroeconomic Risks: Interest rate movements and inflationary pressures can affect the repayment capacity of borrowers.

Concentration Risk: A significant portion of the portfolio remains concentrated in hire-purchase financing of a limited asset category, which may affect diversification benefits.

E. Opportunities and Threats Opportunities:

Rising demand for two-wheeler and four-wheeler electric vehicle and equipment financing in semi-urban and rural areas.

Digital transformation enabling better customer acquisition, faster loan disbursements, and efficient collections.

Partnerships and co-lending opportunities with banks and fintech companies.

Threats:

Intensifying competition from banks, large NBFCs, and fintech players.

Rising cost of funds amidst tightening liquidity conditions.

Possible deterioration in asset quality in case of economic slowdown or rural distress.

F. Outlook

The medium-to-long-term outlook for the NBFC sector remains positive, supported by Indias steady GDP growth, higher credit penetration, government focus on infrastructure and rural development, and an increasing shift of borrowers towards NBFCs for faster, customized financing solutions.

The Company expects steady growth in its loan portfolio and business operations during FY 2026-27, driven by its core hire-purchase financing activities. With improving collections, disciplined credit appraisal, and cautious underwriting, the Company is well positioned to sustain profitability while maintaining asset quality. The Company will continue to focus on prudent risk management, operational efficiency, and strengthening its customer base while capitalising on opportunities in the vehicle and small asset financing segments.

G. Segment-wise or Product-wise Performance

The Company operates in a single business segment, i.e., Leasing and Finance, with a primary focus on Hire Purchase activity. The financing portfolio largely comprises:

Auto rickshaws

Computers

Small equipment

Other productive assets

H. Capital Adequacy Ratio (CRAR)

As an NBFC-ICC-Base Layer the Company is required to maintain a minimum Capital-to-Risk Weighted Assets Ratio (CRAR) of 15% as prescribed by the RBI. As on 31 st March 2026, the Companys CRAR stood at 49.40 % as against 59.17 % as on 31 st March 2025, well above the regulatory minimum.

I. Asset Quality

The Companys Gross Non-Performing Assets (Gross NPA) stood at 2.26 % and Net Non-Performing Assets (Net NPA) stood at 0.46 % as on 31 st March 2026, as against Gross NPA of 2.30 % and Net NPA of 0.69 % as on 31 st March 2025. The Company continues to follow a prudent provisioning policy in line with RBIs Income Recognition and Asset Classification (IRAC) norms.

J. RBI Regulatory Classification

In terms of the RBIs Scale Based Regulation (SBR) framework for NBFCs effective from October 2022, the Company is classified under the Base Layer (NBFC-BL), and continues to comply with the applicable regulatory, governance, and reporting requirements prescribed for NBFCs in this layer.

K. Key Financial Ratios

In accordance with Regulation 34(2)(e) read with Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, details of significant changes (i.e. change of 25% or more as compared to the immediately previous financial year) in the key financial ratios are given below, along with detailed explanations therefor:

Ratio	FY 2025-26	FY 2024-25	% Change	Explanation, change 25%	if
Debt-Equity Ratio	1.36	1.36	0.00%	-
Current Ratio	1.25	1.25	0.00%	-
Interest Coverage Ratio	0.93	0.92	1.09% Increase	-
Operating Profit	3.17	3.09	2.59% Increase	-
Margin (%)
Net Profit Margin (%)	23.56	23.89	1.38% Decrease	-

Return on Net Worth for FY 2025-26 stood at 0.02 as against 0.03 in the previous year, representing a change of 0.01 .

L. Internal Control System and their Adequacy

The Company has an internal control system commensurate with the size and nature of its business. During the year, such controls were tested and no reportable material weakness in the design or operation was observed. The Company is in process of appointing Internal Auditor of the Company The internal control framework is reviewed periodically to ensure its continued adequacy and effectiveness.

M. Discussion on Financial Performance with respect to Operational Performance

The details of the financial performance of the Company are appearing in the Balance Sheet, Profit & Loss Account, and other financial statements appearing separately. Please refer to the Directors Report for highlights. A summary of key operational and financial highlights for FY 2025-26 is provided in Section C (Performance Review) and Section K (Key Financial Ratios) above.

N. Accounting Standards

The financial statements of the Company have been prepared in accordance with the applicable Indian Accounting Standards (Ind AS)/Accounting Standards as prescribed under the Companies Act, 2013. There were no material changes in the accounting treatment followed by the Company during FY 2025-26 as compared to the previous year, other than as disclosed in the notes to the financial statements.

O. Material Developments in Human Resources / Industrial Relations Front

As on 31 st March 2026, the Company had 6 employees on its rolls. The Company continues to recognise the contribution of its employees and strives to provide a cordial, safe, and growth-oriented work environment. Employee productivity and relations during the year remained satisfactory and harmonious. The Companys migration of listing from the BSE SME Platform to the Main Board of BSE, completed in FY 2024-25, continued to remain in effect throughout FY 2025-26, with no further material developments on this front during the year.

Cautionary Statement

Statements in this Management Discussion and Analysis Report describing the Companys objectives, projections, estimates, and expectations may be forward-looking statements within the meaning of applicable securities laws and regulations. Actual results may differ materially from those expressed or implied due to economic conditions, regulatory changes, tax laws, and other unforeseen circumstances.

On behalf of the Board of Directors
Money Masters Leasing and Finance Limited

Hozef Darukhanawala
Managing Director
DIN: 00177029

Place: Mumbai
Date: 27 th July, 2026