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Muthoot Finance, India, beats its quarterly profit forecast on the strength of loan growth

Indian gold loan financier Muthoot Finance announced a 90% increase in its first-quarter profits on Wednesday. This was aided by a higher demand for loans as the price of precious metals soared.

Muthoot Finance has reported a profit for the quarter April-June of 20,46 billion rupees (US$233.91m), which is above analysts' estimates of 16,24 billion rupees. This was based on data compiled by LSEG.

Gold prices reached multiple records during the third quarter. Gold financiers benefit from this as the higher prices allow borrowers to get larger loans with the same amount.

Analysts said that tighter lending conditions in the unsecured sector prompted people to turn to gold loans as a source of alternative funds.

Muthoot Finance’s standalone loan assets were up 42% on an annual basis to 1.2 trillion Rupees by the end of the third quarter. Interest income was also up 53%, to 55.92 Billion Rupees.

In a press release, Managing Director George Alexander Muthoot stated that "we are well-positioned" to continue strong growth into fiscal 2026.

The company has also approved equity injections of 5 billion and 2 billion rupees into its two units, Muthoot Money, and Muthoot Homefin.

(source: Reuters)