Shares of Muthoot Finance on Thursday jumped over 11 per cent to a fresh high after the firm reported a 65 per cent year-on-year surge in its consolidated profit after tax for three months ended June 2025.
The gold loan NBFC reported a 90 per cent growth in profit after tax at ₹2,406 crore in Q1 FY26 as against ₹1,079crore in Q1 FY25.
The company has benefited from the tailwinds of sharp uptick in gold prices, improved gold loan demand due to the industry-wide rationing in unsecured credit.
The non-gold business currently accounts for 13–14 per cent of the portfolio, and the company targets to maintain this share in the 15–20 per cent range going forward.
Brokerages have broadly been positive on the stock, increasing target prices, taking cues of strong gold loan growth and asset quality improvement on the back of recoveries from the NPA pool. Global brokerage Morgan Stanley upgraded the stock to overweight at an increased target price of ₹2,920. Jefferies maintained buy at a raised target price of ₹2,950.
Domestic brokerage Motilal Oswal has maintained neutral rating at unchanged target price of ₹2,790. It said that the NBFC delivered healthy performance, even after considering the one-offs in interest income. “ With a favourable demand outlook for gold loans driven by the limited availability of unsecured credit, the company is well-positioned to maintain its healthy loan growth momentum,” it said.
Motilal added that it believes that the valuations are rich for the deep cyclicality in its gold loan growth, which will remain vulnerable to any volatility in gold prices.
Muthoot Finance board had approved an additional equity infusion of ₹200 Crores in Muthoot Homefin (India), and ₹500 Crore in Muthoot Money, wholly-owned subsidiaries of the company.
At 11.46 am, the stock traded 11 per cent higher at ₹2,787.05, hitting a fresh high of ₹2,799 against the previous close of ₹2,510.75. On the NSE, it hit a 52-week high of ₹2,800.
Published on August 14, 2025