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Informist, Thursday, Nov. 13, 2025

 

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--Muthoot Finance Jul-Sept net interest margin 12.66% vs 12.15% qtr ago 
--Muthoot Fin gold loan AUM INR 1.25 tln as on Sept 30, up 45% on year 
--Muthoot Finance loan AUM INR 1.32 tln as on Sept 30, up 47% on year 
--Muthoot Finance Apr-Sept revenue INR 121.36 bln vs INR 78.21 bln year ago 
--Muthoot Finance Apr-Sept net profit INR 43.91 bln vs INR 23.30 bln yr ago 
--Muthoot Finance to raise INR 350 bln via pvt placement of debt 
--Muthoot Finance to infuse INR 5 bln equity in subsidiary Muthoot Money 
--Muthoot Finance Jul-Sept net profit INR 23.45 bln vs INR 12.51 bln yr ago 
--Muthoot Finance Jul-Sept revenue INR 64.32 bln vs INR 41.17 bln year ago 
--Analysts saw Muthoot Finance Jul-Sept net profit at INR 19.44 bln 
--Muthoot Finance Jul-Sept net profit INR 23.45 bln

 

By Priyasmita Dutta

 

NEW DELHI – Muthoot Finance Ltd.'s net profit nearly doubled on year in the September quarter as its business growth jumped on year and margins expanded. The bottom line was sharply higher than analysts' estimates. The growth in profit after tax was the second highest and net revenue from operations was the highest since Oct-Dec 2015, data available with Informist showed.

 

The gold financier posted a net profit of INR 23.45 billion for the quarter, up from INR 12.51 billion a year ago. The bottom line was expected to rise to INR 19.44 billion, according to the average of estimates from six brokerages. The net profit was 15% higher from the trailing quarter.

 

The Kerala-based lender's net revenue from operations for the September quarter rose 56% higher on year and 13% higher sequentially to INR 64.32 billion. The record high top line is due to the surge in gold prices.

 

Spot price of gold as on Sept. 30 was up 53% on year, while it was up 20% from Jun. 30. Any increase in gold prices allows borrowers to borrow higher loan amounts or avail 'top-up' loan facility against the gold already available with the lender as collateral. As a result, the company's loan portfolio expands and helps revenue. Although the lender's other income is negligible at INR 286 million, it is threefold of the year ago figure.

 

On the expenses front, the company's finance cost was nearly 50% higher at INR 23.13 billion, eating into the bottom line. Employee costs also rose 36% to INR 5.21 billion in the September quarter. However, impairment on financial instruments fell sharply to INR 1.14 billion from INR 2.07 billion a year ago. This helped keep the rise in total expenses slower than the top line, at 37% to INR 33.09 billion.

 

With impairments down, asset quality improved sharply in the September quarter. The lender's gross stage III asset ratio fell to 2.25% as on Sept. 30, from 2.58% a quarter ago and 4.30% a year ago. 

 

The company's borrowing rose sharply to INR 1.12 trillion as of Sept. 30, up 55% on year and 8% on quarter, though Muthoot Finance said it came from stable sources. The lender's board Thursday also approved incremental fund raising up to INR 350 billion by issuing redeemable non-convertible debentures by way of private placement, in multiple tranches. The board also approved additional equity infusion of INR 5 billion in Muthoot Money Ltd., a wholly owned subsidiary of the company.

 

Muthoot Finance's net interest margin at the end of September quarter was 12.66%, higher than 11.54% last year. At the end of June quarter, the net interest margin was 12.41%. This was in contrast with analysts' view, who had expected margins to shrink slightly from the trailing quarter as well as from last year as lending yields moderated due to the repo rate cuts by the Reserve Bank of India's Monetary Policy Committee. The RBI's rate-setting panel has cut the benchmark repo rate by 100 basis points so far in 2025.

 

Gold loan disbursement to new customers in 2025-26 (Apr-Mar) rose 23% on year to INR 131.83 billion as on Sept. 30. Overall gold loan assets rose 45% on year to INR 1.25 trillion.

 

India's largest gold financing company held over 209 tonnes of gold as security as on Sept. 30, same as the trailing quarter, but higher than 199 tonnes a year ago. Its average loan ticket size was INR 117,142 in Apr-Sept, up 32%, the lender said. Muthoot Finance's capital adequacy ratio stood at 20.89% as of Sept. 30, lower than 21.96% a quarter ago and 26.96% in the corresponding quarter a year ago.

 

"In view of this performance, we are upgrading our FY26 gold loan growth guidance from 15% to 30-35%," George Alexander Muthoot, managing director of the company, said. "Favourable regulatory changes by the RBI for gold loan sector, higher gold prices and tighter norms for unsecured credit are expected to boost gold loan demand," he said.

 

Muthoot Finance's profit after tax for Apr-Sept was INR 43.91 billion, nearly double on year. Its top line for the period was up over 55% at INR 121.36 billion. On Thursday, shares of Muthoot Finance closed 2% higher at INR 3,393.10 on the National Stock Exchange. The company declared its September quarter results after markets closed.  End

 

Edited by Ashish Shirke

 

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