Manba Finance Ltd (MANBA) Q2FY27 Concall Transcript - Sep-2026 Qtr
Sara: Ladies and gentlemen, good day, and welcome to Manba Finance Q2 and H1 FY '25 Earnings Conference Call hosted by Antique Stock Broking Limited. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call,
Sara: Please signal an operator by pressing star then zero on your touch-tone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Mayank Mistry from Antique Stock Broking Limited. Thank you, and over to you, sir.
Mayank Mistry (Antique Stock Broking Limited): Thank you, Sara. Good evening, everyone. Welcome to Q2 FY25 earnings conference call of Manba Finance Limited. On behalf of Antique Stock Broking, I would like to thank the management for giving us the opportunity to host this call. We have with us from the management team, Mr. Monish Shah, Managing Director and Mr. Jai Mota, the Executive Director and CFO. I'll hand over the call to the management for opening remarks, post which we will open the floor for Q&A. Over to you, sir.
Monish Shah (Manba Finance Ltd): Yeah. I'm Monish Shah, Managing Director of Manba Finance Limited. Good afternoon, everyone and thank you for joining the our earning call today to discuss the performance for the second quarter and first half half of the financial year 2025. I would also like to thank Antique Stock Broking for hosting this earning call. Let me first start by giving a brief overview of the company and operational highlights, followed by which of CFO and will brief you on the financial performance for the period under review. Manba Finance Limited is an NBFC offering range of financial solutions, including loans to new two-wheeler, three-wheeler, used car, MSME LAP, top-up loan, personal loan, used two-wheelers loans, and battery replacement loans. We are currently operating in 148 location across seven states, precisely Maharashtra, Gujarat, Rajasthan, MP, Chhattisgarh, UP, and Karnataka. Our distribution network includes over 1,900 plus dealers. We have a total team size of approximately 2,061 employees, out of which more than 1,100 plus employees are a part of sales team. Our internal collection team ensures low NPAs in the industry. The company commands one of the fastest turnaround time for loan sanction in the industry, with over 60% of our loan sanctioned in one minute, and 92% loan sanctioned within a day. I'm happy to share that recently company's credit rating has been upgraded to A- stable from BBB+ positive by Care Ratings, reflecting the sustainable scale in the company's operations with assets under management registering a compounded annual growth rate CAGR of 36.33%, alongside access to incremental funding at a lower cost, and expectation of 99.99 around 100 crore rupees infusion through preferential issue equity and warrants. Ratings continue to be supported by MFL's experienced management team with established experience in two-wheeler financing, adequate capitalization levels, and adequate profitability parameters. This enhanced credit standing has also supported improving funding efficiency, with the average cost borrowings declined to 10.14%. Moving on the industry landscape. Vehicle registration trends point to healthy demand across the auto sector, creating a supportive environment for auto finance. During the second quarter, two-wheeler registration reached approximately 53 lakh units, with August and September both recording their highest-ever volumes. Three-wheelers registration crossed 3.9 lakh units, supported by strong demand for electric models. Importantly, demand continues to be driven by rural as well as tier 2 and tier 3 markets, which are key focus area for Manba Finance. The momentum was further reflected in September, when FADA reported record vehicle retails registration of 25.37 lakh units, up by 32% year-on-year. Two-wheeler registration grew 33% to 17.9 lakh units, while three-wheeler registration increased to 22% to 1.32 lakh units. Looking ahead, the demand outlook remains encouraging, with 78% of dealers in the industry expecting growth during the October to December. The conversion of deferred demand around the Dhanteras and Diwali festive period is expected to provide further support. We believe this favorable industry trends will create a supportive environment for auto financing and help sustain healthy disbursement momentum in the coming quarter. Further, the company
Monish Shah (Manba Finance Ltd): declared a interim dividend of INR 0.25 per equity share on a face value of INR 10 each for the financial year 26-27, reflecting our continued commitment towards shareholder value creation. I would like to highlight the change in the chairperson of the company from Mr. Nilepilli Ramaswamy Parameswaran to Mrs. Neelam Tated, Independent Directors. Looking forward, we remain confident in our ability to deliver sustainable and profitable growth and long-term value to our stakeholders. Now I'll request our Executive Director and CFO, Mr. Jay Mehta, to brief you in the financial performance for the period under review. Over to Jay.
Jai Mota (Manba Finance Ltd): Thank you, Manish sir. Let me provide a brief overview of the financial performance for the period under review. For the quarter under review, net interest income stood at Rs. 52 crore registering a significant growth of 40% year on year and profit after tax for the quarter increased by 20% year on year to Rs. 14 crore reflecting a healthy profitability and continued operational momentum. For the first half of the financial year 2027, net interest income stood at Rs. 94 crore registering a significant growth of 39% year on year and profit after after tax for the period increased by 28% year on year to Rs. 27 crore. As of September 30, 2026, our asset under management stood at Rs. 1,811 crore, reflecting a robust year-on-year growth of 21%. During the quarter, the disbursement stood at Rs. 267 crore compared to Rs. 233 crore in corresponding quarter of the previous year. For the first half of the financial year, disbursement has reached to Rs. 493 crore, registering a growth over Rs. 398 crore achieved in the corresponding period last year. The strong performance was primarily driven by the encouraging demand in the two-wheeler segment, supported by the continued expansion of our dealer network and addition to the new location and the product during the quarter. During the quarter, we also added around 32,330 new customers, taking our total live customer base to over 2.45 lakhs. We further expanded our presence across Uttar Pradesh, Madhya Pradesh, Rajasthan, and Karnataka, strengthening our portfolio in these assets states. Talking about the product mix for the period under review, two-wheeler accounted for 83.10%, top-up loan 5.70%, three-wheeler 3%, and used vehicle loan 1.60%. This clearly demonstrates that over 95% of our portfolio remains secured. On the equity side, we are successfully raising approximately 100 crore through through a preferential issue, further strengthening our capital base and providing additional headroom to support a future loan book expansion. As of September 2006 26, stage 1 asset stood at 1,710 crore, accounting for 94.44% of the total portfolio, reflecting a strong asset quality. Stage 2 asset were 47 crore, that is 2.60% of the gross asset and remained lower compared to the previous quarter. Gross 3 assets stood at Rs. 54 crore or 2.96% of the gross asset. As at at the end of the quarter, GNPA and NNPA improved substantially to 2.96 and 2.19% respectively, reflecting a lower delinquency driven by the discipline underwriting and the strong collection efficiency. On the provisioning front, we continue to maintain prudent trends. Our expected credit loss provision stood at Rs. 23 crore compared to the IRAC requirement of 13 crore, resulting in a healthy and excess buffer. Further, our capital adequacy ratio remained healthy at 24.69%, well above the regulatory requirement, providing ample headroom to support our future growth. Overall, we believe the company well-positioned for the sustainable long-term growth, supported by the strong momentum in the AUM and disbursement growth, strong asset quality, improving profitability metrics, a healthy capital position, and
Jai Mota (Manba Finance Ltd): continued strengthening of our liabilities franchise. Going forward, we remain focused on disciplined growth, deeper market penetration, prudent risk management and delivering consistent value to our stake- all stakeholders. With this, we can now open a floor for the question and answer session.
Sara: Thank you very much. We will now begin with the question and answer session. Anyone who wishes to ask a question, may press star and one on the touch-tone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Ravi Khanna, an individual investor. Please go ahead.
Ravi Khanna: Hello. Am I audible?
Sara: Yes sir, please go ahead.
Ravi Khanna: Okay, thank you for this opportunity. So, I just had a few questions. So, first first of all, sir, your dealer network reached approximately 1,932 partners across 148 locations in seven states. However, sir, Gujarat and Maharashtra still make up nearly half of the dealer base. So, I just wanted to know what is the growth trajectory and timeline to achieve critical mass in newer territories like UP, MP, and Rajasthan?
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