Muthoot Finance shares surge over 6% after strong Q3 print

Shares of Muthoot Finance jumped as much as 6.5% on Thursday to Rs 2,321.8 on the BSE after the gold loan-focused NBFC reported a nearly 26% year-on-year growth in its net profit for the third quarter ended December at Rs 1,389.18 crore, compared to the Rs 1,103.52 crore profit reported in Q3 of the previous financial year.

The company’s revenue from operations surged 36% year-on-year to Rs 5,190 crore in the third quarter, up from Rs 3,820 crore in the corresponding period last year. Interest income also saw a sharp rise, reaching Rs 5,067 crore in the December quarter.

Muthoot Finance reported its highest-ever consolidated loan assets under management (AUM) at Rs 1.11 lakh crore as of December 31, 2024. During the quarter, gold loan assets increased by Rs 6,800 crore, while consolidated loan AUM grew by 7% sequentially and 34% year-on-year to Rs 1,11,308 crore.

Chairman George Jacob Muthoot attributed the growth to strong macroeconomic conditions and government policy support. “Amid favorable macroeconomic indicators, the Union Budget’s positive tax reform announcements are expected to start a consumption cycle,” he said, adding that the Reserve Bank of India’s liquidity-enhancing measures and potential rate cuts could further boost economic activity.

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Managing Director George Alexander Muthoot noted that the company is expanding its non-gold loan segments, aiming to grow their contribution to 18-20% over the next five years. The housing finance arm disbursed Rs 880 crore in the first nine months of FY25, up from Rs 493 crore a year earlier. The company has tempered disbursements in its microfinance segment due to industry challenges but expects a recovery in the next couple of quarters.

The company’s shares closed in the red at Rs 2,176.85 on Wednesday, ahead of the earnings announcement. Analysts remain divided on the stock’s outlook—13 out of 26 analysts recommend a “buy,” five suggest a “hold,” and two advise selling, according to Trendlyne data. The consensus target price of Rs 2,161 implies a potential downside of 7% from current levels.

Muthoot Finance shares have surged over 72% in the past year and delivered a 23% return over six months. The stock has risen 2.6% in the past week.

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