Manappuram Finance Limited has secured a crucial regulatory milestone with the Reserve Bank of India (RBI) granting final approval for the indirect change of control and management of two key subsidiaries. The approval, communicated on March 18, paves the way for a significant corporate restructuring involving foreign investment entities.

RBI Approval Details

The central bank has approved the indirect change of control and management of Asirvad Micro Finance Limited (AMFL) and Manappuram Home Finance Limited (MHFL) through separate communications dated March 18. This approval is directly linked to the underlying proposed acquisition by BC Asia Investments XXV Limited (Investor 1) and BC Asia Investments XIV Limited (Investor 2).

Investment Structure and Open Offer

The approval relates to the proposed investment by the two BC Asia Investments entities in Manappuram Finance Limited, which will result in their acquisition of control and shareholding of up to 41.66% of the company's paid-up equity capital. This transaction triggers a mandatory open offer to public shareholders under SEBI regulations.

The investors and other identified persons acting in concert with Investor 1 are required to make the open offer in compliance with Regulation 3 and Regulation 4 of the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011.

Regulatory Compliance and Conditions

The RBI's final approval comes with specific conditions that were previously disclosed in the company's intimation dated February 14. The central bank has also advised both AMFL and MHFL to issue public notices regarding the change of control, while waiving the standard minimum time period of 30 days.

Previous Communications Timeline

Manappuram Finance has maintained regular communication with stock exchanges regarding this transaction through multiple intimations spanning several months. This regulatory approval represents a significant step forward in the proposed acquisition and restructuring process, enabling the company to proceed with the transaction subject to the conditions specified by the RBI.

Manappuram Finance Limited has disclosed receiving a monetary penalty of Rs 2.70 lakh from the Reserve Bank of India for non-compliance with variable pay deferral directions. The penalty relates to violations concerning two Key Managerial Personnel during FY 2024-25.

RBI Penalty Details

The Reserve Bank of India imposed the monetary penalty under Section 58G(1)(b) read with Section 58B(5)(aa) of the Reserve Bank of India Act, 1934. The penalty was communicated through a Speaking Order dated March 09, 2026, which was forwarded to the company via RBI letter dated March 13, 2026.

Non-Compliance Issues

During the statutory inspection conducted for FY 2024-25, RBI observed that Manappuram Finance had not complied with directions relating to 'deferral of variable pay' for two Key Managerial Personnel. The company had paid the entire variable pay upfront to these KMPs without deferring any portion, which violated RBI guidelines on compensation for KMPs and senior management personnel in NBFCs that mandate deferral of variable pay.

Company's Response and Corrective Actions

Manappuram Finance has taken comprehensive steps to address the non-compliance:

• Policy Revision: The company has reviewed and revised its remuneration framework to incorporate mandatory deferral of variable pay for KMPs and senior management personnel
• Board Approval: The revised remuneration policy was approved by the Nomination and Remuneration Committee and the Board
• Enhanced Provisions: The new policy includes deferred variable pay along with malus and clawback provisions
• Recovery Process: The Board has decided to apply the revised policy provisions to variable pay already paid for FY 2024-25, with the deferred portion being recovered in instalments from the two concerned KMPs

Financial Impact Assessment

The company has stated that the monetary penalty of Rs 2.70 lakh does not have any material impact on its financials, operations, or other activities. This disclosure was made pursuant to Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

The penalty represents a regulatory compliance matter that has been addressed through policy revisions and recovery mechanisms, ensuring future adherence to RBI guidelines on variable pay deferral for key personnel.