Mufin Green Finance Ltd Management Discussions

INDIAN ECONOMY

India?s economic environment remained supportive in 2025-26, driven by robust domestic demand, moderating inflation and policy measures that sustained growth. Headline CPI inflation fell to 0.71% in November 2025 and stayed below the RBI?s medium-term target, settling at 3.40% in March 2026. This enabled the Monetary Policy Committee to reduce the repo rate to 5.25%, while cuts in the cash reserve ratio improved banking system liquidity. GST rationalisation, effective from September 22, 2025, further strengthened household purchasing power and supported consumption.

Against this backdrop, real GDP grew by 7.7%, up from 7.1% in 2024-25, while real GVA expanded by 7.9%. Private final consumption expenditure rose by 7.7% and gross fixed capital formation by 8.2%, reflecting resilient household demand and sustained investment. Growth was driven by the secondary and tertiary sectors, which expanded by 8.8% and 9.3%, respectively, offsetting the primary sector?s more moderate growth.

The favourable economic environment also supported the NBFC sector. Rising economic activity, improved liquidity and continued formalisation boosted credit demand across consumer, vehicle, small business and retail segments. Looking ahead, real GDP is projected to grow between 6.5% in 202627, supported by consumption, infrastructure investment and digital adoption. However, global trade conditions, commodity prices, capital flows and private investment will remain key factors shaping the growth outlook.

GDP GROWTH TRAJECTORY

Fiscal year	Growth rate
2026-27 P	6.5%
2025-26 E	77%
2024-25 E	7.1%
2023-24 E	7.2%
2022-23 E	7.6%

E: Estimated I P: Projected

(Sources: https://www.imf.org/en/publications/weo/issues/2026/04/14/world-economic-outlook-april-2026; https://mospi.gov.in/uploads/latestreleasesfil es/1776078391571-Press_Release_of_CPI_March_2026. pdf; https://www.mospi.gov.in/uploads/latestReleases/latest_ release_1780655857536_5ac01869-ca4a-422d-b7a7- 57b81da60932_Press_Note_on_GDP_Estimates_fo r_ Q4_2025-26_and_PE_FY_2025-26_F.pdf; https://mospi. gov.in/uploads/latestreleasesfiles/1776078391571-Press_ Release_of_CPI_March_2026.pdf; https://www.pib.gov.in/ PressReleasePage.aspxRs.PRID=2219907)

INDUSTRY STRUCTURE AND DEVELOPMENTS

Indian Financial Services Industry Overview

India?s financial services sector entered 2025-26 with strong momentum, supported by projected real GDP growth of 7.4% and average inflation of 1.7% during April to December 2025. The RBI reduced the repo rate by 100 basis points to 5.25% and the cash reserve ratio to 3.0%, improving liquidity and supporting 14.5% year-on-year bank credit growth by December 2025. Banks remained well capitalised, with the CRAR at 17.2% in September 2025, while gross non-performing assets fell to record lows. By February 2026, banking deposits reached approximately 257 Trillion and credit 208 Trillion, driven by housing, vehicle, personal and MSME loans. At the same time, digital infrastructure, including UPI, Account Aggregators and e-KYC, continued to expand financial access, accelerate processing and improve operating efficiency.

Against this backdrop, NBFCs remained vital credit providers, particularly across gold loans, vehicle finance and diversified retail lending, following balance sheet and advance growth of around 20% in the previous year. The insurance sector also benefited from policy support through the proposed increase in the foreign direct investment limit to 100%, with the market projected to reach 19.3 Lakh Crores in 2025-26. Meanwhile, household savings continued shifting towards market-linked instruments, with the share of equity and mutual funds rising from about 2% in 2011-12 to over 15% in 2024-25. Financial inclusion strengthened further, as the RBI?s Financial Inclusion Index increased from 64.2 to 67.0, reflecting broader access to formal financial services nationwide.

Outlook

India?s financial services sector is expected to sustain steady growth in 2026-27, supported by resilient domestic demand, continued credit expansion, improving asset quality and broader financial inclusion. NBFCs are likely to remain key credit providers across retail, MSME, vehicle and specialised financing segments. Meanwhile, advances in digital infrastructure, data-led underwriting and institutional partnerships should further improve customer access and operating efficiency. Continued growth in insurance, asset management and sustainable finance is also expected to expand sector opportunities.

Despite these positives, geopolitical uncertainty, energy price volatility, funding pressures, cybersecurity risks and stress in unsecured lending will require close monitoring. Sustaining profitable growth will therefore depend on disciplined underwriting, diversified funding, adequate liquidity and strong regulatory compliance.

(Sources: https://www.indiabudget.gov.in/economicsurvey/ doc/eschapter/echap01.pdf; https://www.indiabudget.gov. in/economicsurvey/doc/eschapter/echap03.pdf: https://web- assets.bcg.com/5a/dd/c15f3a6b457095a3f0362ft14e9a/nbfc-sector- update-fy25h1.pdf; https://www.ibef.org/industry)

Indian NBFC Industry

India?s expanding economy, increasing formalisation and rising demand for credit continue to create a favourable environment for NBFCs. These institutions complement banks by serving underserved regions, borrowers with limited credit histories or formal collateral, and sectors requiring specialised financing. As economic activity and financial inclusion deepen, NBFCs are expected to play an increasingly important role in expanding credit access.

Funding conditions improved during 2025-26, particularly through banking channels. Bank lending to NBFCs rose 26.3% year-on-year to 20.65 Lakh Crores in March 2026. Monetary easing also created room for borrowing costs to moderate, although the extent of the benefit depended on liability mix, credit ratings, spreads and repricing timelines.

The RBI assessed the sector as financially sound, supported by strong capital buffers, healthy profitability and improving asset quality. Credit growth among Upper and Middle Layer NBFCs moderated to 16.6% in March 2026 but remained concentrated in retail, services and industry. Stress tests further indicated that aggregate capital levels would stay above regulatory requirements under adverse scenarios, although certain entities could face pressure.

Against this backdrop, portfolio strategies became more selective amid stress in microfinance and certain unsecured segments. Greater emphasis on secured, asset-backed and cash flow-based lending, coupled with wider use of digital data, strengthened credit assessment and improved operating efficiency. Looking ahead, maintaining funding discipline, asset quality, customer protection and regulatory compliance will remain essential for sustainable growth.

Outlook

India?s NBFC industry is expected to grow steadily, driven by rising credit demand, greater financial inclusion and opportunities across retail, MSME, vehicle, housing and green finance. Digital underwriting, strategic partnerships and diversified funding sources will support efficient expansion. However, asset-quality pressures, funding costs, cybersecurity risks and evolving regulatory requirements will remain key challenges. Institutions with disciplined underwriting, strong liquidity and effective collection capabilities will be best positioned to deliver sustainable and profitable growth.

(Sources: https://www.rbi.org.in/Scripts/PublicationReportDetails.

aspxRs.ID=1319; https://www.rbi.org.in/Scripts/PublicationReportDetails. aspxRs.ID=1325&UrlPage; https://www.careratings.com/uploads/ newsfiles/1778152239_FY26%20Credit%20Offtake%20Closes%20 Strong%20NBFCs%20at%20the%20Forefront.pdf)

GROWTH DRIVERS FOR THE INDIAN NBFC INDUSTRY

1. Digital Transformation and Technological

Advancements: Digital sourcing, automated underwriting, API integrations and Account Aggregators enhance efficiency, strengthen fraud control and improve customer experience, together, enabling faster credit assessment and loan disbursals.

2. Financial Inclusion: Technology-driven onboarding, alternative data and tailored products are expanding formal credit access for underserved borrowers with limited documentation or credit histories.

3. Sustainability and Green Financing: Government support and wider adoption of electric mobility, solar energy and sustainable infrastructure are driving demand for green and project-linked financing.

4. Strengthening Risk Management and Asset Quality:

Robust capital buffers, secured lending, cash flow-based underwriting, digital monitoring and early warning systems reinforce portfolio quality and support sustainable growth.

5. Improving Funding Access and Institutional Partnerships: Greater access to bank funding, efficient monetary transmission, and co-lending and on-lending partnerships are expanding capital availability and credit delivery across specialised segments.

6. Formalisation of the Borrower Ecosystem: GST records, Udyam registration and digital transaction histories are improving borrower visibility and enabling more accurate cash flow assessments.

7. Expansion of Asset-Backed and Specialised Financing:

Growth in infrastructure, logistics, healthcare, renewable energy and mobility is increasing demand for equipment, vehicle and customised business financing.

ABOUT THE COMPANY

Mufin Green Finance Limited (‘Mutin? or ‘The Company?) is a technology-driven NBFC delivering tailored financing solutions to underserved and emerging segments. Building on its expertise in electric mobility and rooftop solar financing, the Company has expanded into mediclaim premium financing and salary-linked loans to state government employees. Through digital platforms, ecosystem partnerships and data-driven underwriting, Mufin broadens financial access, enhances customer experience and builds a diversified, profitable lending portfolio across India.

ELECTRIC VEHICLE (EV) FINANCING

India?s electric mobility market grew strongly during 2025-26, with EV registrations exceeding 25 Lakh units, around 24% higher than the previous year. EV penetration rose to approximately 8.5% of total vehicle registrations from 7.7% a year earlier. Electric two-wheelers accounted for nearly 58% of all EV registrations, while electric four- wheelers and passenger three-wheelers recorded robust growth. Continued government support through PM E-DRIVE, state-level incentives and expanding charging infrastructure is accelerating adoption. At the same time, fleet electrification across logistics, mobility and last-mile delivery is widening financing opportunities.

Despite strong growth, financing remains critical because of high upfront costs, battery-related risks and uncertainty over residual values. Battery leasing, usage-linked repayment models and digital loan processing, supported by partnerships with manufacturers, fleet operators and charging providers, can accelerate adoption while creating opportunities for specialised lenders. The Company pioneered e-mobility financing, supporting over 70,000 EVs across India. This segment comprises 25.56% of AUM (393.96 Crores)

(Sources: https://jmkresearch.com/indias-ev-penetration-reached- 8-5-in-fy2025-26/, https://evreporter.com/india-sold-2550865- electric-vehides-across-categories-in-fy-2025-26/; https://www.

pib.gov.in/PressReleasePage.aspxRs.PRID=2246042&lang=1&reg=3, https://niti.gov.in/sites/default/files/2025-08/Electric-Vehicles-WEB- LOW-Report.pdf)

SOLAR FINANCING

India?s solar market expanded significantly during 2025-26, supporting the national goal of achieving 500 GW of nonfossil-fuel capacity by 2030. Solar capacity additions reached approximately 44.6 GW, taking cumulative solar capacity to 150.26 GW and total renewable energy capacity to 274.68 GW as of March 31, 2026. Rooftop solar additions were estimated at 8.7 GW, around 69% higher than the previous year, driven by rising residential adoption under the PM Surya Ghar Muft Bijli Yojana. As of March 2026, the scheme had enabled approx. 26.19 Lakh installations and disbursed 17,967.53 Crores in Central Financial Assistance.

This rapid expansion is creating financing opportunities across residential and commercial segments. Long-tenure loans, lease-based structures and partnerships with EPC contractors and developers can improve affordability while supporting disbursement growth. This segment comprises 4.22% of AUM (65.08 Crores)

(Sources: https://www.pib.gov.in/PressReleasePage.aspxRs.PRID=22 50039&lang=1&reg=3; https://www.pib.gov. in/PressReleasePage.aspxRs.PRID=2244670; https://mnre. gov.in/en/physical-progress/; https://www.pv-magazine- india.com/2026/04/10/india-installs-record-45-gw-solar- capacity-in-fy2026)

MEDICLAIM PREMIUM FINANCING

India?s health insurance segment continued to expand during 2025-26, with premiums rising by approximately 15.4% to around 1.4 Lakh Crores. As a result, health insurance contributed about 40.8% of non-life insurance premiums, up from 38.6% in the previous year. Rising healthcare costs and greater awareness increased demand for insurance while placing affordability pressures on households and small businesses. Insurance premium financing addresses this challenge by allowing customers to repay premiums in instalments, preserving liquidity without compromising coverage. Mediclaim premium financing is Mufin?s flagship digital offering, accounting for 39.44% of total AUM at 607.88 Crores, while maintaining near-zero NPAs. Its strong asset quality is reflected in its CRISIL A+ (SO) pool rating which company has assigned under PTC Transaction.

(Sources: https://www.gicouncil.in/statistics/industry-statistics/segment-wise-report-on-homepage; https://economictimes. indiatimes.com/industry/banking/finance/insure/health- insurance-share-rises-to-41-of-non-life-industry-in-fy26/ articleshow/130973625.cms; https://www.reuters.com/business/ healthcare-pharmaceuticals/india-plans-tighten-oversight- claims-portal-curb-rising-healthcare-costs-source-2025-07-10/)

SALARY-LINKED LOANS FOR STATE GOVERNMENT EMPLOYEES

The Company?s Salary Saathi product, launched during the year, provides loans to state government employees, presently in Rajasthan and Assam, through direct integration with state IFMS portal. Loan instalments are deducted at source from the state treasury before salary is credited, creating a structurally secure repayment mechanism. Combined with a fully digital origination process, this model positions the product for significant scale-up. The Company continues to pursue integrations with additional states to expand its reach.

Mufin?s Salary Saathi provides personal loans to government employees, accounting for 1.71% of total AUM at 26.40 Crores. Payroll-linked repayments support near-zero defaults.

SEGMENT- AND PRODUCT-WISE PERFORMANCE

The Company operates a single business line, namely financing and investment activities. Accordingly, segment-wise reporting is not applicable. As the Company has no operations outside India, geographical segment reporting is also not required.

Within this business, the Company?s Assets Under Management (AUM) are diversified across four product verticals. The indicative portfolio composition as of March 31, 2026, is presented below for information purposes.

Particulars	2025-26	2024-25
Mediclaim Premium Financing	39.44%	17.24%
EV & Solar Ecosystem Financing	29.78%	77.33%
Loans to Corporates and Others (Including MSME)	29.07%	5.43%
Salary Saathi (Government Salary- Backed Lending)	1.71%	-

The percentages represent AUM

OUTLOOK AND STRATEGY

Mufin will pursue profitable growth by improving operating efficiency and maintaining a balanced portfolio. It will strengthen its Mediclaim Premium Financing business along with expanding Salary Saathi through additional state partnerships.

The Company will deepen its presence across Tier II and Tier III markets through technology-enabled customer assessment and loan processing. It will also enhance portfolio quality through data-driven underwriting, continuous asset monitoring and a broader customer base.

The upgraded credit rating will improve access to banks, institutional lenders and green funding. This will diversify funding sources while helping moderate borrowing costs.

Mufin will focus on enhancing profitability and capital efficiency through optimising its operating cost and reducing the cost of funds.

The Company aims to create a financial ecosystem combining green finance, mediclaim premium financing, salary-linked loan. Continued investment in artificial intelligence, data- driven underwriting and early warning systems will enhance turnaround times, personalisation and portfolio quality. These capabilities will support broader domestic expansion and selective international opportunities.

OPPORTUNITIES AND THREATS Opportunities

• Rising EV adoption, with penetration reaching approximately 8.5% of vehicle registrations in 2025-26, is driving demand for asset-backed financing across electric two-wheelers, three-wheelers and commercial vehicles

• Record solar-capacity additions and residential rooftop installations under PM Surya Ghar Muft Bijli Yojana are expanding financing opportunities across households, SMEs, commercial establishments and community projects

• Low insurance penetration and rising awareness of health cover are creating opportunities for Mediclaim premium financing as recurring, granular retail-credit segments

• Payroll-integrated and treasury-supported lending models can strengthen credit assessment, improve repayment visibility and collection efficiency, while supporting scalable customer acquisition

• Underpenetrated Tier II and Tier III markets present growth opportunities across EV, solar and health-linked finance, including integrated vehicle, battery, Mediclaim premium and solar solutions

Threats

• Geopolitical and trade uncertainties may increase energy- price, currency and interest-rate volatility, affecting funding conditions and borrowers? cash flows

• Growing participation by banks, established NBFCs and digital lenders may intensify competition, compress yields and increase customer acquisition costs

• Changes in EV and solar incentives, digital-lending requirements or prudential regulations may affect product economics, funding availability and operating processes

• Any slowdown in economic activity, freight movement, M SME demand, or rural income levels may ad versely affect disbursement growth and could also impact borrowers? repayment capacity and overall portfolio performance

• Retail borrowers operating in cyclical or income-sensitive segments may experience increased repayment pressure during periods of weaker economic activity, necessitating enhanced portfolio monitoring and collection efforts

FINANCIAL PERFORMANCE

The Company recorded a Profit Before Tax of 3,798.21 Lakhs in 2025-26, up from 2,732.29 Lakhs in 2024-25, reflecting an increase of approximately 39%. Asset quality also strengthened during the year, with the Gross Non-Performing Assets ratio improving to 1.94% from 2.48% and the Net Non-Performing Assets ratio declining to 1.65% from 2.11%. This improvement reflects disciplined underwriting, stronger collection processes and an increased focus on granular, secured lending. As a result, the Company delivered higher profitability while further improving portfolio quality.

KEY FINANCIAL RATIOS

The significant changes in the Company?s financial ratios during the year, which were 25% or more compared with the previous year, are summarised below:

Financial Ratios	2025-26	2024-25	Change in %	Reason for Change
Debtors Turnover Ratio	Not Applicable	Not Applicable	-	-
Inventory Turnover (RM)	Not Applicable	Not Applicable	-	-
Interest Coverage Ratio (Times)	1.32	1.31	-	-
Current Ratio	Not Applicable	Not Applicable	-	-
Capital Adequacy Ratio (%)	32.08	30.88	3.89
Gross Stage 3(%)	1.94	2.49	(22.09)	Transitioning Towards Digital Lending
Net Stage 3(%)	1.65	2.12	(22.17)	Transitioning Towards Digital Lending
Debt-Equity Ratio (Times)	2.43	2.60	-	-
Operating Profit Margin (%)	75.00	71.66	4.66	Transitioning Towards Digital Lending
Net Profit Margin (%)	13.41	12.52	7.11	-
Return on Net Worth (%)	4.92	7.51	(34.49)	Return on Net Worth declined primarily due to the equity infusion undertaken in March 2026. As RoNW is calculated based on closing Net Worth, the additional capital increased the denominator without a corresponding increase in profitability during the year. The benefits of the infused capital are expected to reflect in profitability and RoNW in subsequent periods.

DETAILS OF CHANGE IN RETURN ON NET WORTH

The Return on Net Worth for the year under review moderated to 4.92%, compared to 7.51% in the preceding financial year. This shift occurred alongside an impressive 83.80% increase in Assets Under Management (AUM), underscoring strong business momentum and operational expansion. The temporary lower Return on Net Worth was primarily driven by the fresh equity infusion received in March 2026, which significantly enlarged the year-end net worth base at the closure of the financial year.

RISKS AND CONCERNS

The Board oversees the Company?s risk management framework, covering credit, market, interest-rate, liquidity, regulatory, compliance and operational risks. As the loan portfolio expanded into new products, the Company strengthened controls over concentration, vintage, asset- liability, residual-value, technology, cybersecurity and climate-related risks. It continues to refine risk assessment, accountability, early-warning systems and collection capabilities to support responsible portfolio growth and longterm financial stability.

HUMAN RESOURCES

The Company values employee dignity and cultural diversity, fostering empowerment to drive organisational excellence. As

of March 31, 2026, the workforce comprised 420 employees, compared with 536 as of March 31, 2025. This realignment in employee strength accompanies our deliberate strategic transition from a phygital presence to a digital-led product framework, optimising operating costs while scaling execution capabilities.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has appointed an independent firm of Chartered Accountants to conduct periodic internal audits across its operations. Its internal control framework is aligned with the Company?s scale, business complexity and statutory obligations. During the year, the Company strengthened controls over digital origination, customer data protection, platform integrations, treasury-deducted collections, lender relationships, and debenture-related disclosures and covenants. Audit findings are presented to the Audit Committee, which reviews control effectiveness and compliance.

CAUTIONARY STATEMENT

Estimates and expectations stated in this Management Discussion and Analysis may be ‘forward-looking statement? within the meaning of applicable laws and regulations. Actual results may differ materially from those expressed or implied.