Muthoot Fincorp Limited

Established market position in gold financing, supported by extensive experience of the promoters

MFL is the third largest gold loan non-banking financial company (NBFC). The promoters have spent over seven decades in the business of lending against gold jewellery. MFL’s gold loan business grew at steady rate of 22% compound annual growth rate (CAGR) over fiscals 2018 to 2020 and 21% in previous fiscal despite increase in competition from banks and having a regulatory loan-to-value (LTV) disadvantage during last fiscal.

Diversified product profile of the MPG group

The group operates in five major segments: loan against gold jewellery, two-wheeler finance, microfinance, housing finance and small business loans. Overall managed AUM of MPG is around Rs 25,837 crore as on December 31, 2021. The microfinance portfolio is second largest with around 21% of overall portfolio of the group as on December 31, 2021. 

Geographical concentration in portfolio

High geographical concentration persists, with South India accounted for around 60% of the gold loan portfolio as on March 31, 2023, though it improved from 70% as on March 31, 2019. This was achieved by increase in per branch business from branches other than those in southern India; opening of new branches in North, East and South; and closure or merger of non-viable branches in South India. At the group level, around 80% of AUM is concentrated in South Indian states.