Manba Finance: Driving Growth and Strategic Diversification in Q3 FY26

Manba Finance Limited, a prominent Non-Banking Financial Company (NBFC) specializing in tailored financial solutions, has reported a robust performance for the third quarter and nine months ended December 31, 2025. The company demonstrated significant growth in its Assets Under Management (AUM) and disbursements, alongside disciplined asset quality management, reflecting its resilience and strategic foresight in a dynamic market environment.

For the nine-month period of FY26, Manba Finance achieved a record high disbursement of INR 746 crore, with Q3 FY26 alone contributing INR 347 crore. This strong performance was primarily driven by encouraging demand in the two-wheeler segment, supported by the continuous expansion of its dealer network and the addition of new locations during the quarter. The company's AUM witnessed a healthy year-on-year growth of 25%, reaching INR 1,631 crore as of December 31, 2025. This growth underscores the effectiveness of its market penetration strategies and its ability to capitalize on evolving consumer needs.

Financial Highlights and Asset Quality

Manba Finance reported a net interest income of INR 42 crore for Q3 FY26, marking a 17% year-on-year growth, and INR 110 crore for 9M FY26, a 19% year-on-year increase. The profit after tax for Q3 FY26 stood at INR 13 crore, and INR 34 crore for 9M FY26, demonstrating a 15% year-on-year increase. While the profit growth for Q3 was not proportionate to the income growth, management clarified that this was due to the timing of major disbursements occurring late in the quarter, with the income expected to be realized in the subsequent period.

The company's asset quality remains robust, with Gross NPA at 3.38% and Net NPA at 2.57% for 9M FY26. This reflects lower delinquencies, driven by disciplined underwriting and strong collection efficiency. Manba Finance maintains a healthy capital adequacy ratio of 25.06%, providing ample headroom for future growth. The average cost of borrowing has also seen a gradual decline to 10.12%, benefiting from improved credit ratings and favorable market conditions.

Strategic Initiatives and Future Outlook

Manba Finance is actively pursuing several strategic initiatives to sustain its growth momentum and diversify its portfolio. A significant development is the signing of a strategic Memorandum of Understanding (MoU) with TVS Motor Company, positioning Manba Finance as the preferred financier for TVS three-wheeler vehicles across India. This partnership is expected to generate INR 250-300 crore in incremental disbursements over the next 18-24 months, contributing approximately 10% to the total AUM growth.

Furthermore, the company is set to launch an MSME Loan Against Property (LAP) product in February, initially in Mumbai and Pune, targeting loan amounts between INR 5 lakh and INR 20 lakh. This move aims to diversify its offerings and tap into the growing MSME segment. Manba Finance is also increasing its focus on used two-wheeler financing, recognizing it as a less competitive and growing organized market, with an aim to increase this segment's contribution to 10% of the total portfolio from the current 2%.

Geographically, Manba Finance is concentrating on deeper penetration in its existing states, particularly Uttar Pradesh and Madhya Pradesh, where it has received strong market response. This strategy ensures optimized resource allocation and sustained growth within familiar territories. The company also plans to strengthen its Provision Coverage Ratio from 24% to 25-26% in the coming quarter, reinforcing its balance sheet and risk management framework.

Management Commentary and Investor Confidence

Management expressed confidence in achieving an AUM of INR 1,700-1,750 crore by FY26. For FY27, the company is targeting a PAT of INR 65-70 crore, an ROA of 3.25-3.5%, and an ROE of 14-15%, with an overall year-on-year growth target of 25-30%. The company also indicated plans to raise capital in the second or third quarter of the next financial year, contingent on market conditions.

Despite acknowledging some collection issues in EV three-wheeler passenger vehicles, management's overall tone was balanced and confident, highlighting prudent risk management and a strong operational foundation. The company's commitment to leveraging technology for faster loan sanctions and seamless digital journeys further underpins its growth strategy. Manba Finance's consistent performance, strategic initiatives, and transparent communication reinforce investor confidence in its long-term value creation potential.