What happens when storage capacity changed manually from Admin portal for SharePoint Site ?

It won't affect the overall storage limit at all - that only ever looks at the current storage actually used.

The only thing that changes is the site can now store up to 25TB instead of 1TB. It's up to you how you manage this, but it's sometimes a good idea to set it lower than the max 25TB so owners get notified earlier when they are reaching their limit and you can then increase it appropriately.