Press Release February 06, 2026 MENTOR HOME LOANS INDIA LIMITED Rating Downgraded

Product	Quantum (Rs. Cr)	Long Term Rating	Short Term Rating
Bank Loan Ratings	155.00	ACUITE BB | Negative | Downgraded	-
Total Outstanding	155.00	-	-
Total Withdrawn	0.00	-	-

Rating Rationale

­Acuité has downgraded the long-term rating from ‘ACUITE BBB’ (read as ACUITE triple B) to ‘ACUITE BB’ (read as ACUITE double B) on the Rs. 155.00 Cr. bank facilities of Mentor Home Loans India Limited (MHIL). The outlook is 'Negative'. Rationale for the rating. Acuite has downgraded the rating on Mentor Home Loans India Limited primarily on account of the significant misrepresentation of financial data in FY25. The issuer had submitted provisional financials indicating a Profit After Tax (PAT) of Rs. 1.25 Cr. and disbursements of Rs. 67.44 Cr.; however, the audited statements revealed a net loss of Rs. 43.74 Cr. and actual disbursements of only Rs. 17.03 Cr., largely due to elevated write-offs of Rs. 43 Cr. Acuite notes with concern the significant deviation between the FY25 provisional financials submitted by the issuer and the audited results. This material divergence not only underscores weak earnings quality and business contraction but also raises questions on the reliability of financial reporting and governance standards. These factors have collectively constrained the company’s credit profile and have been duly factored into the rating downgrade.

About the company

­MHIL is a Jaipur based non-deposit taking Housing Finance Company (HFC) engaged in mortgage financing, Loans against Property (LAP) and housing loans. The company was originally established in 1995 as a Non-deposit taking Non-Banking Finance Company (NBFC) and subsequently in 2014, the company got registered as a Housing Finance Company with the National Housing Bank. The company is promoted by Mr. G. L. Goyal and is presently managed by Mr. Pawan Goyal (Managing Director), who has over two decades of experience in the financial services sector. The company has presence in Rajasthan, Madhya Pradesh, Maharashtra and Gujarat and operates through a network of 41 branches.

Unsupported Rating

­Not Applicable.

Analytical Approach

­Acuité has considered the standalone business and financial risk profiles of MHIL to arrive at this rating

Key Rating Drivers

Strength

­Adequate Capitalisation MHIL’s capitalization remained comfortable with overall Capital Adequacy Ratio (CAR) of 111.16 percent as on March 31, 2025 as against 119.88 percent as on March 31, 2024. Of the overall CAR as on March 31, 2025, Tier I CAR stood at 101.82 percent and Tier II CAR stood 9.34 percent. The improvement in CAR was majorly on account of reduction in risk weighted assets due to declining on-book loan portfolio. MHIL has a net worth of Rs. 104.88 Cr. and gearing of 0.64 times as on March 31, 2025.  Acuité believes that the MHIL is adequately capitalized to support its growth prospects for over near to medium term.

Weakness

Misrepresentation of Audited FY25 Results Compared to Provisional Statements Acuite notes with concern the significant deviation between the FY25 provisional financials submitted by the issuer and the FY25 audited results, which reflects a serious misinterpretation and misleading disclosure of the company’s performance. While the provisional numbers had indicated a Profit After Tax (PAT) of Rs.1.25 Cr. while the audited statements reveal a net loss of Rs.43.74 Cr. The loss was primarily on account of substantially high write-offs of Rs. 43 Cr. for FY25. Additionally, disbursements were overstated to Rs.67.44 Cr, compared to the actual Rs. 17.03 Cr. for FY25. This material divergence not only underscores weak earnings quality and business contraction but also raises questions on the reliability of financial reporting and governance standards, which Acuite has factored into the rating action.   ­Disputes in the promoter family ­MHIL is a family run NBFC, promoted by Mr. G. L. Goyal. The day to day operations of the company were managed by his sons, Mr. Pawan Goyal and Mr. Basant Goyal. Post a family feud, Mr. Basant Goyal, (a member of the promoter family), who was earlier associated with MHIL as an Executive director, has stepped down from his executive role, though he still continues on the Board of the company. Mr. Pawan Goyal, is presently in charge of the day to day operations. The promoter dispute is currently sub judice and is being represented in National Company LawTribunal (NCLT). The management has inducted professionals from the industry to oversee key functions which were earlier handled by Mr. Basant Goyal. The ability of the new management to maintain the key operating parameters, post these operational level developments is to be examined. Acuité believes that the efficacy of the company to maintain its operating performance and financial flexibility under these circumstances will remain a key rating monitorable.   Decline in Scale of Operations The company’s profitability remains constrained, as evidenced by the steep decline in earnings during FY25, with net interest income reducing to Rs. 9.89 Cr. from Rs. 16.63 Cr. in FY24 and PAT slipping into a significant loss of Rs. 43.74 Cr. against a marginal profit of Rs. 0.39 Cr. in FY24, largely driven by elevated provisioning and write-offs of Rs. 43 Cr. for FY25 which eroded operating gains. Alongside weak profitability, business growth has moderated significantly, reflected in the sharp contraction in disbursements and AUM; disbursements fell to Rs. 17.03 Cr. in FY25 from Rs. 95.27 Cr. in FY24 and remained subdued at Rs. 20.22 Cr. in 9MFY26, while AUM declined to Rs. 254.52 Cr. in FY25 from Rs. 338.97 Cr. in FY24 and further to Rs. 260.06 Cr. in 9MFY26 (provisional), highlighting challenges in sustaining growth momentum.

Rating Sensitivity

­ Resolution of ongoing promoters dispute. Movement in profitability metrics. Liquidity and capitalisation buffers Changes in regulatory environment

Liquidity Position

Adequate

­MHIL has a well-matched asset liability profile as per ALM statement dated March 31, 2025, and reports no cumulative negative mismatches. As on March 31, 2025 MHIL had cash & cash equivalents of Rs. 1.11 Cr. The company also avails cash credit facilities from Banks and has sold down its assets mainly through direct assignment transactions.

Outlook - Negative

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Other Factors affecting Rating

­None.

Key Financials - Standalone / Originator

­ Particulars Unit FY25(Actual) FY24(Actual) Total Assets Rs. Cr. 185.59 259.93 Total Income* Rs. Cr. 15.25 21.25 PAT Rs. Cr. (43.74) 0.39 Net Worth Rs. Cr. 104.88 148.62 Return on Average Assets (RoAA) (%) (19.63) 0.13 Return on Average Net Worth (RoNW) (%) (34.51) 0.26 Debt/Equity Times 0.64 0.64 Gross NPA (%) 1.16 1.67 Net NPA (%) 0.64 1.28 *Total income equals to Net Interest Income plus other income

Status of non-cooperation with previous CRA (if applicable):

­Not Applicable.

Any other information

­None

Applicable Criteria

• Application Of Financial Ratios And Adjustments: https://www.acuite.in/view-rating-criteria-53.htm • Default Recognition: https://www.acuite.in/view-rating-criteria-52.htm • Non-Banking Financing Entities: https://www.acuite.in/view-rating-criteria-44.htm

Note on complexity levels of the rated instrument

­In order to inform the investors about complexity of instruments, Acuité has categorized such instruments in three levels: Simple, Complex and Highly Complex. Acuite’s categorisation of the instruments across the three categories is based on factors like variability of the returns to the investors, uncertainty in cash flow patterns, number of counterparties and general understanding of the instrument by the market. It has to be understood that complexity is different from credit risk and even an instrument categorized as 'Simple' can carry high levels of risk. For more details, please refer Rating Criteria “Complexity Level Of Financial Instruments” on www.acuite.in.

Rating History

Date Name of Instruments/Facilities Term Amount (Rs. Cr) Rating/Outlook 20 Aug 2025 Secured Overdraft Long Term 1.00 ACUITE BBB | Negative (Upgraded from ACUITE BBB- | Stable) Term Loan Long Term 10.53 ACUITE BBB | Negative (Upgraded from ACUITE BBB- | Stable) Term Loan Long Term 0.01 ACUITE BBB | Negative (Upgraded from ACUITE BBB- | Stable) Term Loan Long Term 15.00 ACUITE BBB | Negative (Upgraded from ACUITE BBB- | Stable) Proposed Long Term Bank Facility Long Term 88.67 ACUITE BBB | Negative (Upgraded from ACUITE BBB- | Stable) Secured Overdraft Long Term 4.06 ACUITE BBB | Negative (Upgraded from ACUITE BBB- | Stable) Term Loan Long Term 0.09 ACUITE BBB | Negative (Upgraded from ACUITE BBB- | Stable) Term Loan Long Term 0.71 ACUITE BBB | Negative (Upgraded from ACUITE BBB- | Stable) Secured Overdraft Long Term 9.04 ACUITE BBB | Negative (Upgraded from ACUITE BBB- | Stable) Term Loan Long Term 11.14 ACUITE BBB | Negative (Upgraded from ACUITE BBB- | Stable) Term Loan Long Term 14.75 ACUITE BBB | Negative (Upgraded from ACUITE BBB- | Stable) 25 Jul 2025 Secured Overdraft Long Term 1.00 ACUITE BBB- | Stable (Downgraded from ACUITE BBB | Negative) Term Loan Long Term 10.53 ACUITE BBB- | Stable (Downgraded from ACUITE BBB | Negative) Term Loan Long Term 0.01 ACUITE BBB- | Stable (Downgraded from ACUITE BBB | Negative) Term Loan Long Term 15.00 ACUITE BBB- | Stable (Downgraded from ACUITE BBB | Negative) Proposed Long Term Bank Facility Long Term 88.67 ACUITE BBB- | Stable (Downgraded from ACUITE BBB | Negative) Secured Overdraft Long Term 4.06 ACUITE BBB- | Stable (Downgraded from ACUITE BBB | Negative) Term Loan Long Term 0.09 ACUITE BBB- | Stable (Downgraded from ACUITE BBB | Negative) Term Loan Long Term 0.71 ACUITE BBB- | Stable (Downgraded from ACUITE BBB | Negative) Secured Overdraft Long Term 9.04 ACUITE BBB- | Stable (Downgraded from ACUITE BBB | Negative) Term Loan Long Term 11.14 ACUITE BBB- | Stable (Downgraded from ACUITE BBB | Negative) Term Loan Long Term 14.75 ACUITE BBB- | Stable (Downgraded from ACUITE BBB | Negative) 26 Apr 2024 Proposed Long Term Bank Facility Long Term 3.84 ACUITE BBB | Negative (Reaffirmed ) Secured Overdraft Long Term 4.06 ACUITE BBB | Negative (Reaffirmed ) Secured Overdraft Long Term 1.00 ACUITE BBB | Negative (Reaffirmed ) Term Loan Long Term 0.01 ACUITE BBB | Negative (Reaffirmed ) Term Loan Long Term 1.64 ACUITE BBB | Negative (Reaffirmed ) Term Loan Long Term 2.84 ACUITE BBB | Negative (Reaffirmed ) Term Loan Long Term 0.69 ACUITE BBB | Negative (Reaffirmed ) Term Loan Long Term 2.36 ACUITE BBB | Negative (Reaffirmed ) Term Loan Long Term 1.81 ACUITE BBB | Negative (Reaffirmed ) Term Loan Long Term 13.80 ACUITE BBB | Negative (Reaffirmed ) Term Loan Long Term 0.01 ACUITE BBB | Negative (Reaffirmed ) Term Loan Long Term 15.00 ACUITE BBB | Negative (Reaffirmed ) Term Loan Long Term 1.20 ACUITE BBB | Negative (Reaffirmed ) Term Loan Long Term 4.22 ACUITE BBB | Negative (Reaffirmed ) Proposed Long Term Loan Long Term 4.36 ACUITE BBB | Negative (Reaffirmed ) Proposed Long Term Bank Facility Long Term 58.65 ACUITE BBB | Negative (Reaffirmed ) Proposed Long Term Bank Facility Long Term 5.00 ACUITE BBB | Negative (Reaffirmed ) Term Loan Long Term 15.76 ACUITE BBB | Negative (Reaffirmed ) Term Loan Long Term 18.75 ACUITE BBB | Negative (Reaffirmed ) Proposed Non Convertible Debentures Long Term 10.00 ACUITE Not Applicable (Withdrawn) 28 Apr 2023 Proposed Non Convertible Debentures Long Term 10.00 ACUITE BBB | Stable (Reaffirmed) Proposed Long Term Bank Facility Long Term 3.84 ACUITE BBB | Stable (Reaffirmed) Cash Credit Long Term 10.00 ACUITE BBB | Stable (Reaffirmed) Cash Credit Long Term 1.00 ACUITE BBB | Stable (Reaffirmed) Term Loan Long Term 7.92 ACUITE BBB | Stable (Reaffirmed) Term Loan Long Term 4.84 ACUITE BBB | Stable (Reaffirmed) Term Loan Long Term 3.49 ACUITE BBB | Stable (Reaffirmed) Term Loan Long Term 5.61 ACUITE BBB | Stable (Reaffirmed) Term Loan Long Term 5.21 ACUITE BBB | Stable (Reaffirmed) Term Loan Long Term 2.25 ACUITE BBB | Stable (Reaffirmed) Term Loan Long Term 4.23 ACUITE BBB | Stable (Reaffirmed) Term Loan Long Term 2.69 ACUITE BBB | Stable (Reaffirmed) Term Loan Long Term 17.19 ACUITE BBB | Stable (Reaffirmed) Term Loan Long Term 10.00 ACUITE BBB | Stable (Reaffirmed) Term Loan Long Term 15.00 ACUITE BBB | Stable (Reaffirmed) Term Loan Long Term 3.80 ACUITE BBB | Stable (Reaffirmed) Term Loan Long Term 7.83 ACUITE BBB | Stable (Reaffirmed) Term Loan Long Term 2.69 ACUITE BBB | Stable (Reaffirmed) Term Loan Long Term 3.34 ACUITE BBB | Stable (Reaffirmed) Term Loan Long Term 1.17 ACUITE BBB | Stable (Reaffirmed) Proposed Long Term Loan Long Term 4.36 ACUITE BBB | Stable (Reaffirmed) Proposed Long Term Bank Facility Long Term 33.54 ACUITE BBB | Stable (Reaffirmed) Proposed Long Term Bank Facility Long Term 5.00 ACUITE BBB | Stable (Assigned) Non-Covertible Debentures (NCD) Long Term 5.00 ACUITE Not Applicable (Withdrawn)

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Annexure - Details of instruments rated

Lender’s Name ISIN Facilities Date Of Issuance Coupon Rate Maturity Date Quantum (Rs. Cr.) Complexity Level Rating Not Applicable Not avl. / Not appl. Proposed Long Term Bank Facility Not avl. / Not appl. Not avl. / Not appl. Not avl. / Not appl. 88.67 Simple ACUITE BB | Negative | Downgraded ( from ACUITE BBB ) Jana Small Finance Bank Ltd. Not avl. / Not appl. Secured Overdraft Not avl. / Not appl. Not avl. / Not appl. Not avl. / Not appl. 9.04 Simple ACUITE BB | Negative | Downgraded ( from ACUITE BBB ) A U Small Finance Bank Not avl. / Not appl. Secured Overdraft Not avl. / Not appl. Not avl. / Not appl. Not avl. / Not appl. 4.06 Simple ACUITE BB | Negative | Downgraded ( from ACUITE BBB ) IDFC First Bank Limited Not avl. / Not appl. Secured Overdraft Not avl. / Not appl. Not avl. / Not appl. Not avl. / Not appl. 1.00 Simple ACUITE BB | Negative | Downgraded ( from ACUITE BBB ) Capital Small Finance Bank Ltd. Not avl. / Not appl. Term Loan 23 Apr 2018 Not avl. / Not appl. 23 Jul 2025 0.09 Simple ACUITE BB | Negative | Downgraded ( from ACUITE BBB ) Capital Small Finance Bank Ltd. Not avl. / Not appl. Term Loan 02 Feb 2019 Not avl. / Not appl. 02 Feb 2026 0.71 Simple ACUITE BB | Negative | Downgraded ( from ACUITE BBB ) IDFC First Bank Limited Not avl. / Not appl. Term Loan 23 Jul 2018 Not avl. / Not appl. 23 Jul 2030 10.53 Simple ACUITE BB | Negative | Downgraded ( from ACUITE BBB ) IDFC First Bank Limited Not avl. / Not appl. Term Loan 27 Mar 2017 Not avl. / Not appl. 27 Mar 2024 0.01 Simple ACUITE BB | Negative | Downgraded ( from ACUITE BBB ) IDFC First Bank Limited Not avl. / Not appl. Term Loan 23 Jul 2018 Not avl. / Not appl. 23 Jul 2028 15.00 Simple ACUITE BB | Negative | Downgraded ( from ACUITE BBB ) LIC Housing Finance Ltd. Not avl. / Not appl. Term Loan 24 Mar 2017 Not avl. / Not appl. 01 Aug 2027 11.14 Simple ACUITE BB | Negative | Downgraded ( from ACUITE BBB ) LIC Housing Finance Ltd. Not avl. / Not appl. Term Loan 27 Feb 2018 Not avl. / Not appl. 01 Jul 2028 14.75 Simple ACUITE BB | Negative | Downgraded ( from ACUITE BBB )

Contacts

Mohit Jain Chief Analytical Officer - Rating Operations Tejas Chaugule Analyst - Rating Operations	Contact details exclusively for investors and lenders Mob: +91 8591310146 Email ID: analyticalsupport@acuite.in

About Acuité Ratings & Research

­Acuité is a full-service Credit Rating Agency registered with the Securities & Exchange Board of India (SEBI). The company received RBI Accreditation as an External Credit Assessment Institution (ECAI) for Bank Loan Ratings under BASEL-II norms in the year 2012. Acuité has assigned ratings to various securities, debt instruments and bank facilities of entities spread across the country and across a wide cross section of industries. It has its Registered and Head Office in Kanjurmarg, Mumbai. Disclaimer: An Acuité rating does not constitute an audit of the rated entity and should not be treated as a recommendation or opinion that is intended to substitute for a financial adviser's or investor's independent assessment of whether to buy, sell or hold any security. Ratings assigned by Acuité are based on the data and information provided by the issuer and obtained from other reliable sources. Although reasonable care has been taken to ensure that the data and information is true, Acuité, in particular, makes no representation or warranty, expressed or implied with respect to the adequacy, accuracy or completeness of the information relied upon. Acuité is not responsible for any errors or omissions and especially states that it has no financial liability whatsoever for any direct, indirect or consequential loss of any kind, arising from the use of its ratings. Ratings assigned by Acuité are subject to a process of surveillance which may lead to a revision in ratings as and when the circumstances so warrant. Please visit our website (www.acuite.in) for the latest information on any instrument rated by Acuité. Please visit https://www.acuite.in/faqs.htm to refer FAQs on Credit Rating. Note: None of the Directors on the Board of Acuité Ratings & Research Limited are members of any rating committee and therefore do not participate in discussions regarding the rating of any entity.