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Muthoot Finance reports over 17% drop in Q1 PAT, plans to open 150 branches by Oct


India’s largest gold loan NBFC, Muthoot Finance witnessed a dull June 2022 quarterly earnings due to decline in its loan assets during the period. In Q1FY23, the company posted a standalone net profit of 802 crore declining by 17.4% from 971.2 crore in the same quarter last year. Q1 PAT also dipped by 16.5% from 960.3 crore in Q4 of the previous fiscal. Revenue from operations stood at 2,503.9 crore in Q1FY23 contracting from 2,713.8 crore in Q1FY22 and 2,669.9 crore in Q4FY22.

On a consolidated basis, Muthoot reported gold loan assets under the management to the tune of 63,444 crore down by 2% from 64,494 crore in Q4FY22 but up by 9% against 58,135 crore in Q1FY22.

George Jacob Muthoot, Chairman, of Muthoot Group said, “We continue to deliver stellar performance in gold loan space. Though there is a dip in loan assets during the quarter, we have achieved a YoY growth of 9% in loan assets at Rs.63,444 crore. High frequency indicators suggest recovery in economic activity, with strong urban demand environment though the rural demand is still reviving.”

Of the total gold loan assets on the group level — Muthoot Finance’s subsidiaries recorded loan assets worth 6,755 crore up by 20% yoy and 4% qoq. While the company registered loan assets of 56,689 crore up by 8% yoy but down 2% sequentially.

Further, the chairman added, “the Indian economy has been resilient and we are optimistic about steady demand conditions for gold loans coupled with the huge untapped opportunity in gold loan segment. The RBI approval for opening new 150 branches, coupled with the recent digital initiatives, gold Loan@home service will help us further expand and tap new customers.”

Meanwhile, George Alexander Muthoot, Managing Director, Muthoot Finance said, “The impact of the very low-interest rate teaser loans has resulted in lower yields during Q1FY23. The launching of teaser loans was a strategic move taken in Q3 FY 22 and it enabled us to attract a set of new high-value customers.”

The MD said that the company is expecting the opening of 150 new branches to be completed by October 2022 upon which additional business will be generated.

As of June 30, 2022, the Group’s branch network is 5,667 branches up by 4% from 5,443 branches in Q1FY22 and also higher by 2% against 5,579 branches in Q4FY22.

On BSE, Muthoot Finance shares closed at 1,187.95 apiece up by 15.20 or 1.30%. The company’s market cap is around 47,679.49 crore.

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