undefined share price Management discussions


Non-Banking Financial Corporations (NBFCs) have emerged as the primary source of financing for a vast section of the population including small and medium-scale enterprises as well as the economically unserved and underserved individuals. They have been able to meet the diverse requirements of borrowers in the most efficient and timely approach considering their wide geographic reach, comprehension of the numerous financial needs of people, and extremely swift turnarounds. Therefore, non-bank lenders have contributed significantly to the cause of financial inclusion in this process and have also been a key component in fostering the expansion of millions of MSMEs and self-employed people. In addition to the growing role played by non-bank lenders in the consumer financing industry, the expansion of a few key economic sectors, including housing, consumer goods, and transportation, has been boosted. Non-Banking Financial Companies (NBFCs) have contributed towards the development of the countrys infrastructure. The availability of long-term funding by non-bank lenders has helped in the financial closure and growth of many large-scale infrastructural projects. Non-Banking Financial Companies (NBFCs) have played a crucial role in fostering credit expansion across a range of industries, including microfinance loans, personal loans, and auto finance loans.


A tentative recovery in 2022 has been followed by increasingly gloomy developments in 2023 as risks began to materialize. Global output contracted in the second quarter of this year, owing to downturns in China and Russia, while US consumer spending undershot expectations. Several shocks have hit a world economy already weakened by the pandemic: higher-than-expected inflation worldwide especially in the United States and major European economies triggering tighter financial conditions; a worse-than-anticipated slowdown in China, reflecting COVID- 19 outbreaks and lockdowns; and further negative spillovers from the war in Ukraine.

The baseline forecast is for growth to slow from 6.1 percent last year to 3.2 percent in 2022, 0.4 percentage point lower than in the April 2022 World Economic Outlook. Lower growth earlier this year, reduced household purchasing power, and tighter monetary policy drove a downward revision of 1.4 percentage points in the United States. In China, further lockdowns and the deepening real estate crisis have led growth to be revised down by 1.1 percentage points, with major global spillovers. And in Europe, significant downgrades reflect spillovers from the war in Ukraine and tighter monetary policy. Global inflation has been revised up due to food and energy prices as well as lingering supply-demand imbalances, and is anticipated to reach 6.6 percent in advanced economies and 9.5 percent in emerging market and developing economies this year upward revisions of 0.9 and 0.8 percentage point, respectively. In 2023, disinflationary monetary policy is expected to bite, with global output growing by just 2.9 percent.

Financial markets remained jittery in FY 21-22 due to domestic economic slowdown, concerns on fiscal slippage and geopolitical tensions. Weaknesses in overall economic activity also put pressure on business growth of lenders including NBFCs. The spread of COVID-19 in March 2020, further heightened uncertainties for FY21-22.

In response, Governments across the world have unleashed massive fiscal measures to protect economic activity and dramatically strengthen health services and testing. Central banks, too, have initiated multiple monetary and regulatory measures.


After the pandemic decline, 2023 has brought growth for the NBFCs. It has demonstrated an innovative and resilient streak over the years which includes adapting efficiently even during the COVID-19 pandemic to avoid the revolving credit landscape. The market share of NBFCs has increased in the last few years with Asset Under Management (AUM) accounting for as much as 18% of the overall credit on March 2019, up from 12% in March 2008. A few challenges over the past three years lowered their share to 16% in fiscal 2022, with banks making bigger growth strides. The increase in NBFCs AUM from US$ 44.02 billion (Rs. 3.6 lakh crore) in March 2008 to almost US$ 330.21 billion (Rs. 27 lakh crore) in March 2022, and is expected to increase further, indicates the importance of the sector to overall credit delivery in the economy.


NBFCs have become increasingly important in recent years as they have played a critical role in providing credit to individuals and businesses that are underserved by traditional banks. This is especially true in rural and semi-urban areas, where NBFCs have been able to fill the gap left by banks. One of the key advantages of NBFCs is their ability to be flexible in their lending practices. Unlike banks, which have a rigid set of guidelines for lending, NBFCs can tailor their lending practices to meet the specific needs of their clients. This has made them an attractive option for those who are looking for more personalised financial services. They are financial institutions that provide a wide range of banking services like loans, credit facilities, investments, and other financial products. NBFCs have played a significant role in the Indian economys growth story, especially in the rural and semi-urban areas. They cater to the financial needs of small and medium-sized businesses, entrepreneurs, farmers, and individuals who do not have access to traditional banking services. In this article, we will explore the future of NBFCs in India.

However, NBFCs also have their share of challenges. One of the biggest challenges facing NBFCs in India is access to funding. Unlike banks, which have access to low-cost deposits, NBFCs must rely on borrowing from banks or issuing bonds to raise funds. This can make it difficult for NBFCs to compete with banks on interest rates. Another challenge faced by NBFCs is the regulatory environment. While the RBI regulates NBFCs, there are also several other regulators that oversee different aspects of the financial services industry. This can create confusion for NBFCs, especially those that operate across multiple states or regions.

In the past Aadhar has been a great help for financial institutions for faster on-boarding and managing KYC. The SC ruling had impacted many players who build their business models on Aadhar. P2P lenders had a good year end to rejoice as RBI had hiked the investment limit from Rs 10 lakh to Rs 50 lakh subject to declaration of net worth by a Chartered Accountant. The recent boost from RBI which raised P2P lending cap from Rs 10 lakh to Rs 50 lakh is a game changer, an income tax rebate/deduction for P2P investment can further help the P2P lending industry. Also, operational efficiencies can be significantly improved if the government facilitates Aadhaar based services for KYC & agreements signing.

According to the Reserve Bank of Indias (RBI) Financial Stability Report-2020, recent developments in the non-banking financial companies (NBFC) sector have brought the sector under greater market discipline as the better performing companies continued to raise funds while those with Assets Liability Mismatch and/or asset quality concerns were subjected to higher borrowing costs. In terms of network analysis, the total outstanding bilateral exposures among constituents of the financial system narrowed during 2021-22.

One of the key factors driving the positive outlook for NBFCs in India is the regulatory environment. The Reserve Bank of India (RBI) and other regulatory bodies have taken significant steps to promote the growth and stability of the sector. They have introduced measures to streamline NBFC operations, enhance risk management practices, and strengthen corporate governance. These regulatory reforms have not only fostered investor confidence but have also encouraged NBFCs to adopt more responsible lending practices, ensuring the overall stability of the financial system. Another catalyst for the booming NBFC sector is the rapid advancement of technology. The digital revolution has transformed the way financial services are delivered and consumed. NBFCs have embraced technology to enhance their operational efficiency, expand their reach, and offer innovative products and services. Digital lending platforms, online payment systems, and mobile banking solutions have empowered NBFCs to cater to a broader customer base efficiently. Moreover, technology-driven credit assessment models and analytics have enabled NBFCs to make faster, data-driven lending decisions, reducing the time taken for loan approvals. Indias growing middle class, urbanization, and increasing disposable incomes are also fueling the demand for NBFC services. As aspirations rise and consumer preferences evolve, there is a greater need for accessible and flexible financial solutions. NBFCs have been quick to adapt to these changing dynamics by introducing customer-centric products and customizing their offerings to suit specific needs. From instant personal loans to EMI financing for consumer durables, NBFCs are well-positioned to meet the evolving demands of the Indian population.

Furthermore, the governments initiatives such as the Pradhan Mantri Awas Yojana (PMAY), the Pradhan Mantri Mudra Yojana (PMMY), and the Atmanirbhar Bharat Abhiyan have provided a significant boost to the NBFC sector. These programs focus on affordable housing, small business development, and self-reliance, aligning perfectly with the core competencies of NBFCs. By supporting these initiatives, NBFCs contribute to inclusive growth and help foster entrepreneurship and job creation in the country.

NBFCs can bring the much-needed diversity to the financial sector thereby diversify the risks, increase liquidity in the markets thereby financial stability and efficiency can be promoted to the financial sector. In the backdrop of a growing economy, NBFCs will continue to grow in the financial ecosystem and create meaningful financial inclusion and further the government agenda of “Self- reliant India”, “Make in India” and ‘Start-Up India.

The Directors confirm that all the investments have been made with the intent to hold for long term appreciation, to enhance the income from dividends and are not held for trade. The Company continues to remain invested in sectors, which we believe have potential to remain value accretive over the long term. The Company continues to invest for the long term while availing opportunities to realize gains. The Company endeavours to evaluate opportunities considering the macroeconomic conditions both globally and domestically

In Conclusion, By having a clear vision and leveraging the growth potential of the NBFC industry, individuals can benefit financially and actively participate in Indias evolving financial landscape.


The financial performance of the Company for the year 2022-23 is described in the Directors Report under the head of ‘Operation.


The Company has only one segment i.e., NBFC Investment and loan Company.


The Internal Control Systems and their Adequacy of the company for the year 2022-23 is described in the Directors Report under the head of ‘Internal Control Systems and Their Adequacy.


Driven by the Groups visionary leadership during the year, training programs are conducted to facilitate competency development both functional and behavioral for harmonious and cordial Industrial relations. The knowledge and skill enhancement programme were conducted for the employees. No operating days were lost due to strike, lock out etc. Human Resources Development, in all its aspects like training safety and social values are under constant focus of the management.

We responded swiftly to the COVID-19 outbreak by adopting various measures to ensure health and safety of our employees. We cancelled all physical trainings and conferences and took extensive precautions like sanitization of offices, availability of hand sanitizers and masks and operations in multiple shifts to ensure lesser number of staff thus enabling social distancing. We have readied our offices to further ensure health protocols, such as making operational our Central Emergency Service Desk (CESD) into a 24x7 helpline, continuous communication on protection and social distancing, and self-declaration surveys for employees on their health status.

Statement in this Management Discussion and analysis describing the Companys objective, projects, estimates and expectations may be forward looking statement within the meaning of applicable laws and regulations. Actual results may vary significantly from the forward-looking statements contained in this document due to various risks and uncertainties. Several factors could make a significant difference to the Companys operations. These include

economic conditions, Government regulations and Tax Laws, political situation, natural calamities etc. over which the Company does not have any direct control.

Date: 05/09/2023
Place: Surat
Registered Office:
Office No. 316 & 317, Massimo
Commercial Building, 3rd Floor,
Althan Bhimrad Road, Bhimrad,
Surat, Gujarat, 395017
CIN: L67120GJ1995PLC024449
Email: aadhaarventures@gmail.coms
Website: www.aadhaarltd.com
By Order of the Board of Directors
For Aadhaar Ventures India Limited
Sd/- Sd/-
Jils Madan Jyoti Munver
Director Director
DIN: 02810555 DIN: 02810560