Muthoot Finance Ltd Q1 FY 2015 Results

Muthoot Finance Ltd, the largest gold financing company in India in terms of loan portfolio, declared a net profit of Rs.180crs in the first quarter of FY15. Total income stood at Rs.1092crs. The company’s standard asset provisioning stands at 0.46% at the end of the quarter against regulatory requirement of 0.25%.

Commenting on the results M G George Muthoot, Chairman stated “Company’s performance during the quarter is a clear sign that the business model is capable of overcoming the adversities and deliver consistent results. The commitment and focus of the company in the business should benefit the stakeholders at large going forward.”

Speaking on the occasion George Alexander Muthoot, Managing Director said “Company could deliver stable results during the quarter in terms of business as well as profitability. The de-growth in gold loan portfolio has further reduced to Rs.313crs as compared to Rs.645crs in Q4 FY14.  Profit after tax  has remained stable QoQ and would have been higher by around Rs.7crs but for the increased depreciation on account of change in depreciation calculation method based on useful life as per the new Companies Act, 2013 provisions. On operational front, we have re-activated branches after almost two years of turbulent and inactive period and we are seeing positive results at grass root level. We are witnessing customers, who left us to unorganized sector in search of better deal, coming back and availing loans from us.  We are reorienting ourselves to deal with gold loan as a ‘push’ product rather than as a ‘pull’ product which was the approach till now. We expect the business to improve in the coming quarters. Further, as a prudent provisioning policy, Company is maintaining a higher standard asset provisioning of 0.46% against regulatory requirement of 0.25%”    

Business Highlights:

About Muthoot Finance Ltd:                                                                                                                                        

Muthoot Finance Limited is the largest gold financing company in India in terms of loan portfolio. The company is a “Systemically Important Non-deposit taking NBFC” headquartered in the southern Indian state of Kerala. Operating history of Muthoot Finance has evolved over a period of 75 years since M George Muthoot (the father of our Promoters) founded a gold loan business in 1939 under the heritage of a trading business established by his father, Ninan Mathai Muthoot, in 1887.

The company provides personal loans secured by gold jewellery, or Gold Loans, primarily to individuals who possess gold jewellery but could not access formal credit within a reasonable time, or to whom credit may not be available at all, to meet unanticipated or other short-term liquidity requirements.

Company is listed on both National Stock Exchange and Bombay Stock Exchange.

Safe Harbor

Certain statements in this release are forward-looking statements. The business involves various risks, and uncertainties that could result in the actual results to differ materially from those indicated here. All forward looking statements made herein are based on information presently available to the management of the Company and the Company does not undertake to update any forward-looking statement that may be made from time to time by or on behalf of the Company. Therefore the investors are requested to make their own independent assessments and judgments by considering all relevant factors before making any investment decision.