Ceejay Finance Limited (**CFL**) is an **RBI-registered Non-Banking Financial Company (NBFC) – Asset Finance Company** with a specialized focus on the informal and unorganized sectors of rural and semi-urban India. Part of the established **Ceejay Group**, the company possesses over **26 years** of operational history. CFL bridges the credit gap for low-income groups and small-scale entrepreneurs who are traditionally underserved by the formal banking system. --- ### **Strategic Market Positioning and Growth Drivers** CFL’s strategy is built on the "high-efficiency loan originator" model, leveraging localized reach to serve the economically weaker sections of society. * **Co-Lending Framework:** A central pillar of CFL’s growth is the **RBI’s co-lending framework**. By partnering with larger banking institutions, CFL combines its superior ground-level origination and customer care capabilities with the low-cost liquidity of banks. * **Product Diversification:** While historically focused on vehicle finance, the company is aggressively targeting high-growth segments including **Microfinance**, **MSME (Micro, Small and Medium Enterprises)**, and **Affordable Housing**. * **Geographic Expansion:** The company is rapidly scaling its physical footprint to drive disbursements. The branch network expanded from **32** in March 2024 to **41** by September 2025, serving a growing borrower base of **26,215** customers. * **Target Demographic:** The core focus remains on farmers, agricultural laborers, and small traders in **Tier II and Tier III towns**, utilizing a hybrid model of physical branch delivery and digital fintech integration for underwriting. --- ### **Core Lending Portfolio and Operations** CFL operates under a single business segment (**Finance**) with a product suite designed for the rural economy. * **Vehicle Financing:** The primary revenue driver, consisting of **Two-wheeler financing**, **Three-wheeler financing**, and **Second-hand four-wheeler financing**. * **Mortgage & Personal Loans:** Supplementary products include **Loans Against Property (LAP)** and personal loans to diversify the interest income stream. * **Underwriting Discipline:** The company employs a framework focused on **Return on Assets (ROA)**. Impairment allowances are calculated under **Ind AS 109**, which consistently exceed the standard **RBI IRACP** requirements. * **Revenue Recognition:** Interest income is recognized via the **Effective Interest Rate (EIR)** method. Notably, additional interest on delayed payments is recognized strictly on a **realization basis** to maintain conservative accounting standards. --- ### **Financial Performance and Asset Quality** CFL maintains a robust balance sheet characterized by high capital buffers and improving asset quality metrics. **Key Financial Indicators** | Metric (₹ in Crore) | H1FY26 (Sept 2025) | FY 2024-25 | FY 2023-24 | FY 2022-23 | | :--- | :--- | :--- | :--- | :--- | | **Assets Under Management (AUM)** | **117.03** | **116.45** | **96.90** | **79.88** | | **Annual Disbursements** | - | **96.48** | **69.39** | **66.28** | | **Net Interest Margin (NIM)** | - | **19.47%** | **17.42%** | - | | **Tangible Net Worth** | - | **75.21** | **68.87** | - | | **Gross NPA (90+ dpd)** | **4.94%** | **10.54%** | **12.26%** | **13.48%** | **Capital and Liquidity** * **Capital Adequacy:** As of **H1FY26**, the **Capital Adequacy Ratio (CAR)** stood at **63.59%** (entirely **Tier-I capital**), vastly exceeding the regulatory requirement of **15%**. * **Gearing:** The company maintains a conservative leverage profile with an **Overall Gearing of 0.56x** and **External Debt Gearing of 0.14x** as of H1FY26. * **Dividend:** For FY 2023-24, the board rewarded shareholders with a final dividend of **₹1.20 per equity share (12%)**. --- ### **Funding Structure and Resource Mobilization** CFL’s funding strategy has shifted toward institutional and group-backed debt while eliminating retail liabilities. * **Group Reliance:** Approximately **75%** of total borrowings (as of **H1FY26**) are sourced from **Ceejay Group** entities via unsecured loans at a fixed rate of **9.00%**. This provides a stable, low-cost funding base. * **Institutional Debt:** The company has **discontinued** fresh public deposits. It now utilizes a **₹17.8 crore** total cash credit limit and has increased reliance on **Inter-Corporate Deposits (ICDs)**, which rose to **₹32.72 crore** in FY25. * **Credit Ratings:** Reaffirmed in **February 2026** by **CARE Ratings**: * **Long-Term Bank Facilities:** **CARE BBB- (Stable)** * **Short-Term Bank Facilities:** **CARE A3** --- ### **Risk Management and Governance Framework** CFL operates a structured risk management framework overseen by specialized committees to monitor liquidity, credit quality, and asset-liability maturity patterns. * **Concentration Risks:** * **Geographic:** **95%** of AUM is concentrated in **Gujarat**, with **5%** in **Maharashtra**. * **Product:** The portfolio is heavily weighted toward **two-wheeler loans**. * **Credit Risk Mitigation:** Loans are largely secured through **vehicle hypothecation** and **property mortgages**. A significant increase in credit risk is flagged at **30 days past due (dpd)**, with default defined at **90+ dpd**. * **Leadership:** The company is led by **Kiran Patel** (Chairman, **35+ years** experience) and **Deepak Patel** (Managing Director, **29 years** experience). * **Strategic Appointments:** * **Mrs. Prachi Nikunj Patel (Independent Director):** Appointed **Aug 2025**; brings expertise in Finance and Social Sectors. * **Mr. Chinmay Bharatbhai Amin (Independent Director):** Serving a 5-year term (**2024–2029**) for strategic oversight. * **M/s. Alpesh Vekariya & Associates:** Appointed as Secretarial Auditor through **FY 2029-30**. --- ### **External Challenges and Outlook** While CFL is well-capitalized, it faces several external headwinds: * **Macro-Environmental:** Repayment capacity in rural areas is highly sensitive to **erratic rainfall** and agricultural cycles. * **Competitive Landscape:** Intense competition from **large NBFCs**, commercial banks, and captive financing arms of vehicle manufacturers. * **Regulatory Environment:** The company is monitoring the implementation of the **four Labour Codes** (effective **Nov 21, 2025**), though the immediate financial impact is expected to be non-material. * **Technological Imperative:** Ongoing investment in **cyber security** and digital underwriting is required to defend against technology disruption in the fintech space.