Muthoot Finance Q2 Results Highlight Strong Growth as Profit Jumps 87% and Board Approves ₹35,000 Crore Fundraise

Contents

Profit Surges on Strong Gold Loan Demand and Elevated Gold Prices Record Net Interest Income and AUM Reflect Broad-Based Growth Management Confident on Outlook; Sees Strong Sector Tailwinds Digital Push and Customer Reach to Accelerate Growth Board Approves ₹35,000 Crore NCD Fundraise to Support Expansion

In a quarter marked by soaring gold prices and robust credit demand, Muthoot Finance Q2 Results reflected strong financial momentum with the company posting a sharp 87.4% year-on-year rise in standalone profit. The gold loan major reported a profit of ₹2,345 crore for the quarter ended September 2025, significantly higher than ₹1,251 crore recorded in the same period last year.

This impressive growth comes at a time when the gold loan industry is witnessing renewed traction, driven by favorable regulatory changes, high gold valuations, and rising preference for secured credit amid tightening norms for unsecured lending.

Profit Surges on Strong Gold Loan Demand and Elevated Gold Prices

The sharp surge in profitability in the Muthoot Finance Q2 Results can be attributed primarily to the strong performance of its core gold loan portfolio. With gold reaching multiple record highs during the quarter, the underlying collateral value of gold holdings increased substantially.

This not only enhanced the company’s asset quality and loan-to-value strength but also empowered borrowers to avail higher loan amounts against the same jewellery holdings. As a result, demand for gold-backed credit surged across both urban and rural markets.

Moreover, with non-banking financial companies facing pressures in the unsecured loan segment due to tighter risk norms, gold loans emerged as a more reliable and easily accessible funding option. This shift further contributed to Muthoot Finance’s loan growth during the quarter.

Also Read : Shares of Yatra Online Soar 35% in 3 Days Following Robust Q2 and Target Upgrades

Record Net Interest Income and AUM Reflect Broad-Based Growth

Alongside robust profits, Muthoot Finance Q2 Results showcased a strong rise in net interest income (NII), which grew 58.5% year-on-year to ₹3,991 crore, up from ₹2,518 crore in the same period last year. The impressive increase signals both higher disbursements and improved yields across loan products.

The company’s standalone loan assets under management (AUM) also posted a strong 47% year-on-year expansion, reaching ₹1,32,000 crore by the end of September 2025.
On a consolidated basis, the AUM climbed to a historic high of ₹1,47,673 crore, reflecting the sustained momentum in Muthoot’s gold and non-gold loan segments.

Management Confident on Outlook; Sees Strong Sector Tailwinds

Chairman George Jacob Muthoot expressed satisfaction with the quarter’s performance, emphasizing that the company’s consistent growth trajectory is backed by the continued strength of the gold loan business.

He noted that the consolidated loan AUM hitting a record level underscores the resilience and long-term potential of gold-backed lending in India.

Managing Director George Alexander Muthoot added that the recent regulatory changes by the Reserve Bank of India (RBI) have made the gold loan sector more structurally robust. He highlighted that rising gold prices and tightening norms for unsecured loans will further elevate demand for secured lending, particularly gold loans.

He also reaffirmed the company’s strategy to expand its non-gold loan portfolio, which includes personal loans, home loans, business loans, and microfinance, while keeping non-gold AUM at around 12–15% of the overall loan book.

The MD further pointed out that the microfinance sector is displaying renewed strength due to improved underwriting and regulations—an encouraging sign for Muthoot’s diversified loan offerings.

Digital Push and Customer Reach to Accelerate Growth

A key highlight of the company’s forward strategy is its accelerated digital transformation. Muthoot Finance is investing in digital lending solutions and technology-driven processes to make credit access faster, frictionless, and more secure for millions of customers nationwide.

The management believes that enhanced digital capabilities will help the company tap into younger borrowers, underserved markets, and customers seeking quick, document-light loans.

Board Approves ₹35,000 Crore NCD Fundraise to Support Expansion

One of the major decisions announced alongside the Muthoot Finance Q2 Results was the board’s approval to raise ₹35,000 crore through redeemable Non-Convertible Debentures (NCDs) via private placement.
The fundraise will be executed in multiple tranches and is aimed at strengthening the company’s capital position, supporting future loan growth, and ensuring ample liquidity for its expanding lending operations.

Stock Market Reaction Remains Positive

Shares of Muthoot Finance reflected investor confidence as they closed 2.26% higher at ₹3,400 on the NSE following the announcement of the quarterly results. Analysts believe that the company’s sector leadership, strong balance sheet, and favorable industry outlook position it well for sustained medium-term growth.