stock market crash
A terrible decline is being seen in the stock market today. Major companies of the country are trading in the red. Meanwhile, a stock was noticed which belongs to the finance sector. The surprising thing is that in the quarterly results, the profit of that company increased by 95 percent. Despite such excellent results, the stock of that company went down by about 14 percent. We are talking about Muthoot Finance Company, its shares have crashed today.
Shares of Muthoot Finance fell as much as 14% to an intraday low of Rs 3,577 on the BSE on Friday, even as the company reported a sharp rise in third quarter earnings. Standalone net profit almost doubled to Rs 2,656 crore from Rs 1,363 crore a year ago. This increase was due to 47% reduction in provisions and additional profit of Rs 111 crore. The total income of the company increased by 64% year-on-year to Rs 7,263 crore. Assets under management increased by 51% to Rs 1.48 lakh crore, of which gold loans accounted for Rs 1.40 lakh crore.
During this period, total loan AUM increased by Rs 38,905 crore, i.e. a growth of 36%. Gold loan AUM increased by Rs 36,702 crore, which is 36% increase. Gold loan AUM grew by Rs 14,740 crore in the December quarter alone, i.e. quarter-on-quarter (QoQ) growth of about 12%. Managing Director George Alexander Muthoot said that the company has increased its annual growth guidance for FY26 from 3035% to 4445%. He said that the business is getting good support due to strong demand and regulatory clarity in the gold loan segment.
Brokerage opinion on the stock
Jefferies has maintained Buy rating with a target price of Rs 4,750. AUM grew 51% YoY in Q3, although loan-to-value remained slightly lower and tonnage declined. Profit margins softened slightly quarter-on-quarter, but operating expenses and credit costs were better than expected. The brokerage believes that strong gold prices, good LTV buffer and easy rules for opening branches will further support the strong growth of AUM.
Disclaimer: This article is for information only and should not be considered as investment advice in any way. TV9 Bharatvarsha advises its readers and viewers to consult their financial advisors before taking any money-related decisions.
