Muthoot Finance share price tumbled more than 11% on Monday, 3 August, despite the company reporting robust Q1 FY27 earnings. The gold loan-focused NBFC posted a 43% year-on-year rise in consolidated net profit to ₹2,825 crore for the June quarter, compared with ₹1,974 crore in the year-ago period.
According to the company’s regulatory filing, total income increased to ₹8,695 crore in Q1 FY27 from ₹6,485 crore a year earlier. Total expenses also rose to ₹4,898 crore, compared with ₹3,812 crore in the corresponding quarter last year.
The company’s loan assets under management (AUM) grew 43% year-on-year to ₹1.92 lakh crore, up from ₹1.34 lakh crore in the same period last year.
The board also approved the appointment of Alexander George as Managing Director, effective 1 October 2026.
In an interview with CNBC-TV18, the management reiterated its positive outlook, stating that loan yields are expected to stabilise at 18-18.5%, while net interest margin (NIM) guidance has been maintained at 10.5-11%. It also indicated that the FY27 AUM growth guidance of 15% could be revised upward after the second quarter if business momentum remains strong.
Nuvama Institutional Equities maintained its ‘Hold’ rating on Muthoot Finance with a revised target price of ₹3,300 (from ₹3,325), saying the company reported a softer-than-expected June quarter.
The brokerage noted that standalone AUM growth moderated to 43% year-on-year and 6% quarter-on-quarter (consolidated AUM grew 43% YoY and 5% QoQ), reflecting the impact of declining gold prices. It added that the net interest margin (NIM) fell 297 basis points sequentially to 10.4%, resulting in a 17% miss in profit after tax, while Stage-3 assets improved 11 basis points QoQ to 2.5%.
Nuvama cautioned that increasing competition, regulatory changes, and falling gold prices could weigh on growth and profitability. It expects standalone return on assets (RoA) to normalise to 4.8%-5.3% from the recent peak of 6.7%, driven by slower growth and margin moderation.
