Credit Rating

30th September, 2026 To, To, National Stock Exchange of India Limited, BSE Limited, Exchange Plaza, Plot No. C/1, G Block, Phiroze Jeejeebhoy Towers, Bandra-Kurla Complex, 21st Floor, Dalal Street, Bandra (East), Mumbai – 400051. Mumbai – 400001. NSE Symbol: SBFC BSE Equity Scrip Code: 543959 Dear Sir/Madam, Sub: Disclosure of Credit Rating under Regulations 30, 51 and 55 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 read with SEBI Master Circular dated 11th July, 2025 Pursuant to the aforementioned regulations and circular, please find below the details of the credit rating(s) provided by India Ratings and Research Private Limited on 30th September, 2026: A. Assignment and revision in outlook from stable to positive of the Company's bank facilities, the details of the same is mentioned below: Credit Rating Agency Instrument Rated Amount Credit Rating Rating Action (Rs. in crore) India Ratings and Research Bank Loan 1,000.00 IND AA-/ Positive Assigned Private Limited India Ratings and Research Bank Loan 5,000.00 IND AA-/ Positive Affirmed; Private Limited Outlook revised to Positive B. Affirmation of the credit rating of Company’s non-convertible debentures, the details of the same is mentioned below: Details of credit rating Current rating details ISIN INE423Y07104, INE423Y07138 Amount (₹ crore) 500.00 (Including unutilised 100.00) Name of the Credit Rating Agency India Ratings and Research Private Limited Credit Rating Assigned IND AA-; Positive (Double A Minus; Outlook:Positive) Outlook (Stable/ Positive/ Negative/ No Outlook) Positive Rating Action (New/ Upgrade/ Downgrade/ Re- Affirmed Affirm/ Other) Specify other rating action Outlook revised to Positive Date of Credit rating 30th September, 2026 Verification status of Credit Rating Agencies Verified Date of verification INE423Y07104: 17-04-2026 INE423Y07138: 17-04-2026 SBFC Finance Limited Registered Office: Unit No. 103, 1st Floor, C&B Square, Sangam Complex, Andheri Kurla Road, Village Chakala, Andheri (East) Mumbai - 400 059 T.: +91-22-67875300 • F : +91-22-67875334 • www.SBFC.com • complianceofficer@sbfc.com CIN No: L67190MH2008PLC178270 The details of ratings provided by India Ratings and Research Private Limited is enclosed herewith. This information is also being uploaded on the website of the Company at: https://www.sbfc.com/investors. You are requested to take the same on record. Thanking you, Yours faithfully, For SBFC Finance Limited Sanket Agrawal Chief Financial Officer Encl : As above SBFC Finance Limited Registered Office: Unit No. 103, 1st Floor, C&B Square, Sangam Complex, Andheri Kurla Road, Village Chakala, Andheri (East) Mumbai - 400 059 T.: +91-22-67875300 • F : +91-22-67875334 • www.SBFC.com • complianceofficer@sbfc.com CIN No: L67190MH2008PLC178270 India Ratings Revises Outlook on SBFC Finance’s NCDs & Bank Loan Facilities to Positive; Affirms Existing Debt at ‘IND AA-’; Rates Additional Limits Sep 30, 2026 | SBFC Finance Limited | Non Banking Financial Company (NBFC) India Ratings and Research (Ind-Ra) has revised the Outlook on SBFC Finance Limited’s (SBFC) non-convertible debentures (NCDs) and bank loan facilities to Positive from Stable, while affirming long-term debt rating at ‘IND AA-’. The detailed rating actions are as follows: Details of Instruments Size of Rating Regulator of Date of Coupon Maturity Rating Instrument Type Issue (INR Assigned with Instrument Issuance Rate Date Action million) Outlook/Watch Bank loan IND RBI - - - 10,000 Assigned facilities AA-/Positive Affirmed; Non- Refer ISIN IND Outlook convertible - - - 5,000 annexure AA-/Positive revised to debentures* Positive Affirmed; Bank loan IND Outlook RBI - - - 50,000 facilities AA-/Positive revised to Positive *Details in annexure Analytical Approach Ind-Ra continues to take a standalone view of SBFC to arrive at the ratings. Detailed Rationale of the Rating Action The Outlook revision reflects SBFC’s expanding franchise, which is supported by a diversified loan book across geographies, healthy internal accruals, a diversified funding profile, and adequate capitalisation. The company benefits from SBFC’s focused product approach, including a granular and largely secured loan portfolio, which is supported by defined underwriting standards. However, the ratings are constrained due to SBFC’s moderate seasoning, wherein the asset quality stability through the cycle, along with the stability of the existing senior management, after the recent transitions, needs to be monitored. List of Key Rating Drivers Strengths Well-diversified branch network supporting granular secured assets Healthy profitability buffers Adequate capitalisation to support franchise growth Diversified borrowing profile Weaknesses Stable asset quality; however, seasoning needs to be established Senior management stability, a monitorable Detailed Description of Key Rating Drivers Well-Diversified Branch Network Supporting Granular Secured Assets: SBFC is focused on scaling its core lending franchise, supported by significant growth opportunities within its existing product segments and customer base. The company has strengthened its franchise through a steady expansion of its branch network, increasing the total number of branches to 256 as of 1QFY27 (FY26: 251; FY25: 205), spanning 18 states and two union territories, covering 201 cities in India. This expanding geographic footprint supports business diversification, enhances customer reach in underserved markets, and provides a strong platform for sustaining growth in the granular retail lending portfolio. SBFC has indicated a measured approach to branch expansion in FY27, with an aim to add 10-15 branches. As per the management, the company’s focus is likely to remain on improving the productivity and profitability of the recently opened branches, before undertaking further expansion. SBFC’s loan portfolio is granular in nature, primarily focusing on two key products: loan against property (LAP), catering to micro, small, and medium enterprises (MSMEs), and loans against gold (LAG). At end-June 2026, the average ticket size of secured MSME loans and LAG stood at INR1.1 million and INR0.1 million, respectively. The company focuses on traders and retail customer profiles in its MSME segment, with ticket sizes less than INR3 million and a loan-to-value ratio of less than 70%. As of 1QFY27, SBFC’s AUM stood at INR119.2 billion (FY26: INR112.7 billion; FY25: INR87.5 billion), comprising a co-origination book of INR17.2 billion and the balance of its own book. The composition of secured MSME loans or LAP reduced to 78% of the AUM in 1QFY27 (FY26: 79%; FY25: 83%), while LAG composition increased to 22% (21%, 17%), driven by increased gold prices. SBFC’s gold loan book is efficient, with an AUM of about INR113 million per branch at end-June 2026. Around 90% of the secured MSME book is backed by residential properties as collateral. SBFC’s in-house sourcing drives better retention rates. Despite the recent changes in the guidelines for gold loans, SBFC has adapted well to the new norms, ensuring minimal impact on its business operations. The company intends to maintain a conservative loan-to-value (LTV) approach for gold loans amid the changing regulatory norms. Healthy Profitability Buffers: SBFC’s return on average AUM (as per Ind-Ra’s calculation methodology) remained healthy at 4.5% in 1QFY27 (FY26: 4.5%; FY25: 4.4%) and its return on tangible equity improved to 14.8% (14.2%; 12.7%), supported by increased leverage. The improvement in profitability over the past 36 months was driven by a shift in business focus towards LAG, which is a higher yielding product. The increased proportion of gold loans with higher yields resulted in a rising trend in yields, despite a focus on better CIBIL score customers in the LAP segment. The profitability is also being driven by SBFC's ability to reduce borrowing costs as per Ind-Ra’s calculation methodology (1QFY27 [Showing first 8,000 characters — download PDF for full document]