Muthoot Finance shares jump 19 per cent after Q4 earnings
Published On: Thursday, June 18, 2020 | By: Team KnowMyStock
Shares of the Kerala-based lender Muthoot Finance on Thursday jumped 19 per cent after the company reported a 52.4 per cent jump in consolidated net profit at Rs 835.78 crore in the last quarter of the fiscal ended March 2020, due to higher demand for gold loans. The company had posted a net profit of Rs 548.56 crore during the corresponding quarter of fiscal ended March 2019. The Company's asset under management grew 22% year-on-year and a 15% fall in provisions helped boost net profit. The fall in provisions is a fallout of a drop in bad assets. Performance for the last year has been good for the company because of the strong performance of the gold loan business, it said. Its total income during March quarter of FY20 rose to Rs 2,633.58 crore from Rs 2,088.84 crore in the year-ago period, MFIN said in a regulatory filing. For the fiscal year 2019-20, the company reported a 51 per cent jump in consolidated net profit at Rs 3,168.68 crore as against Rs 2,102.96 crore in 2018-19.
“Over the next 12 months, the company is likely to benefit from the sharp run-up in gold prices and higher gold loan demand due to the impact of the lockdown on customers. Thus, we increase our EPS (earnings per share) estimates by 8-12%," analysts from Motilal Oswal Financial Services Ltd wrote in a note.
Source: Money Control, Business India, Economic Times
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