Aastamangalam Finance Ltd Management Discussions

Indias Non-Banking Financial Company (NBFC) sector continues to play a critical role in expanding credit access and supporting financial inclusion across underserved segments of the economy. Over the years, NBFCs have emerged as important intermediaries within the financial system by catering to customer segments that are often beyond the reach of traditional banking channels, particularly in MSME finance, consumer lending, rural finance.

OPPORTUNITIES AND THREATS:

NBFCs continue to benefit from rising demand for formal credit among MSMEs, self-employed individuals and first time borrowers. Their ability to serve customer segments that remain underpenetrated by traditional banking channels creates a significant opportunity for sustained growth. Liquidity challenges may create an adverse impact on the sectors lending capability. Unforeseen changes in the regulatory landscape and geopolitical uncertainties may require the NBFCs to modify their operations significantly.

SEGMENT WISE / PRODUCT WISE PERFORMANCE:

The Company is engaged in lending activities during the year under review. Hence the requirement of segment-wise reporting does not arise.

BUSINESS OUTLOOK:

India continued to remain one of the worlds fastest growing major economies consistently across FY26, supported by resilient domestic demand, rising household consumption, rapid urbanisation, increasing formalisation of the economy and sustained investment activity. Expanding disposable incomes, a growing middle class and improving business confidence continued to underpin economic activity across sectors, while increasing credit penetration further supported consumption, entrepreneurship and private investment.

RISKS AND CONCERNS:

Unforeseen changes in the regulatory landscape and geopolitical uncertainties are some of the risks and concern for the sector. Also, when individuals or businesses do not repay their loans, NBFCs face default challenges which may reduce the capital available to extend new loans. The principal risks and challenges faced by the NBFC sector include

a) changes in interest rates and borrowing costs;

b) liquidity and funding risks;

c) regulatory and compliance requirements;

d) competition from banks, NBFCs and fintech companies;

e) changes in economic conditions;

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:

The Company has an adequate system of internal controls to ensure accuracy of accounting records, compliance with all laws & regulations and compliance with all rules, procedures & guidelines prescribed by the applicable statues. The Control is also ensured by the Internal Audit process.

FINANCIAL PERFORMANCE AND OPERATIONAL REVIEW:

The Financial performance and operational review is provided under the head Financial Highlights in Directors Report.

HUMAN RESOURCES:

During the year under review, there has been no material development on the Human Resource / Industrial Relations front. The Companys focus is on recruitment of good talent and retention of the talent pool.

KEY FINANCIAL RATIOS:

Key Financial Ratios	FY 2025-26	FY 2024-25	Reason for significant change (i.e. change of 25% or more as compared to the immediately previous financial year)
Debtors Turnover Ratio	-	-	--
Inventory Turnover	-	-	--
Interest Coverage Ratio	4.18	5.64	In view of increase in borrowings
Current Ratio	31.70	130.48	Increase in current liabilities
Debt-Equity Ratio	0.60	0.58	--
Operating Profit Margin (%)	97.53	83.46	--
Net Profit Margin (%)	54.98	53.41	--

By Order of the Board For AASTAMANGALAM FINANCE LIMITED

Place: Chennai	Bhavika M Jain	Khushbu Mohankumar Jain
Date: 26.08.2026	Director	Director
	DIN:07704015	DIN: 07704023