Manba Finance Reports Strong FY26 Results, Plans Portfolio Diversification

Manba Finance Limited announced a robust financial performance for fiscal year 2026, with its Profit After Tax (PAT) increasing by 20% year-over-year to ₹45 crore. The company also reported a significant 24% rise in Net Interest Income (NII), reaching ₹162 crore.

Key Financial Highlights

Manba Finance revealed its FY26 financial results, detailing a 20% year-on-year surge in PAT to ₹45 crore and a 24% growth in NII to ₹162 crore. Assets Under Management (AUM) experienced a substantial 29% increase, reaching ₹1,713 crore. The company is actively pursuing product diversification to lessen its reliance on two-wheeler loans, which currently make up 84.5% of its portfolio. Expansion plans include MSME loans, three-wheelers, and used vehicle financing. Asset quality remained stable, with Gross Non-Performing Assets (GNPA) reported at 3.33% and Net NPAs at 2.46%. Manba Finance also noted its operational efficiency, with a large portion of loans being sanctioned quickly.

Strategic Growth and Diversification

This performance underscores Manba Finance's capability to effectively grow its loan book and profitability. Strategic diversification into new lending areas such as MSME and used vehicles, coupled with geographical expansion, aims to create a more resilient and higher-return business model. Enhanced operational efficiency, including rapid loan approvals, is expected to improve customer experience and potentially drive higher volumes. However, the company has acknowledged challenges in financing three-wheeler electric vehicles, indicating potential hurdles.

Shifting Focus from Two-Wheelers

Historically, Manba Finance has concentrated heavily on two-wheeler financing. Its current diversification strategy is a key move to explore other lending opportunities and reduce concentration risk. The company's AUM has seen consistent growth, supported by sustained demand in its established segments.

Future Plans and Expansion

Manba Finance has set ambitious goals for continued AUM growth, targeting 25-30% annual expansion, and aims to increase the proportion of non-two-wheeler loans in its portfolio. Expansion efforts are underway in Uttar Pradesh and Madhya Pradesh, with plans to enter Karnataka in the second quarter of FY27. The company also intends to raise equity capital in the latter half of FY27 to fuel its growth, while maintaining a debt-to-equity ratio below 4.

Potential Challenges Ahead

Management has identified specific challenges in financing three-wheeler electric vehicles due to customer profiles and depreciation concerns. The unsecured small business loan segment also requires close monitoring. Additionally, Manba Finance has postponed its equity fundraising plans due to geopolitical factors affecting stock market valuations, highlighting its responsiveness to external economic conditions.

Key Performance Metrics

• FY26 Profit After Tax (PAT): ₹45 crore (20% YoY growth)
• FY26 Net Interest Income (NII): ₹162 crore (24% YoY growth)
• FY26 Assets Under Management (AUM): ₹1,713 crore (29% growth)
• AUM Mix: 84.5% two-wheelers, 15.5% other segments
• Gross Non-Performing Assets (GNPA): 3.33%
• Net Non-Performing Assets (NPA): 2.46%
• Two-Wheeler EV Portfolio: Approximately 7-8% of total
• Used Two-Wheeler Loan-to-Value (LTV): 50-55%

What to Monitor

Investors will be closely watching Manba Finance's progress in its geographical expansion, the success of new product launches such as MSME LAP, and the performance of its three-wheeler and EV financing segments. The timing and terms of the planned equity fundraise will also be a significant factor to track.