Manappuram Finance shares witnessed strong buying momentum on January 12, surging 4.5% to hit the day's high of ₹298.70 after the gold loan financier issued a clarification addressing media reports about its proposed deal with Bain Capital.

Market Response to Company Clarification

The stock's recovery came after a sharp decline on Friday, when shares crashed nearly 8% following Reuters reports citing sources that the Reserve Bank of India (RBI) had raised objections to Bain Capital's plans to acquire a controlling stake in the company. The exchanges subsequently sought clarification on January 9 regarding these media reports.

Company's Official Response

In its regulatory filing dated January 9, Manappuram Finance categorically denied the media reports, stating that "The media report is denied, factually incorrect, and speculative in nature." The company emphasized that it has provided regular updates regarding the proposed investment by BC Asia Investments XIV Limited and BC Asia Investments XXV Limited, as well as the acquisition of joint control in the company and its subsidiaries, including Asirvad Micro Finance Limited and Manappuram Home Finance Limited.

The company confirmed that it has also provided regular updates regarding the RBI's approval for a change in management. "In respect of the change of control application filed with the RBI in relation to the proposed transaction, the necessary filings (including responses to clarifications sought by the RBI) have been made, and the final approval of the RBI for the proposed transaction is pending," the company stated.

Stock Performance and Gold Price Impact

Beyond company-specific developments, sharp volatility in gold prices has impacted the stock's performance, with shares down 4.5% in January. However, the stock closed 2025 with impressive gains of 65%, coinciding with a record-breaking rally in gold prices and marking the third consecutive year of positive performance.

Sector Outlook and Expert Views

Harshal Dasani, Business Head at INVasset PMS, highlighted the positive impact of elevated gold prices on the sector. "Gold had seen an extended upside over the past year, which significantly boosted collateral values and loan growth for gold-focused lenders," he noted. Dasani added that demand for gold loans remains strong, asset quality is stable, and balance sheets are well cushioned due to conservative loan-to-value norms.

Key sector strengths include:

• Strong demand for gold loans
• Stable asset quality
• Well-cushioned balance sheets
• Conservative loan-to-value norms
• Structurally strengthened collateral base

"The medium-term outlook for gold-loan NBFCs remains positive, with temporary volatility offering selective opportunities rather than signalling a trend reversal," Dasani concluded, emphasizing the sector's resilience despite short-term market fluctuations.

Manappuram Finance shares surged nearly 5% during Monday's trading session after the company issued a strong clarification denying media reports about delays in Bain Capital's acquisition deal. The NBFC's stock jumped to ₹295.10 on BSE, representing a gain of over 3% from its previous closing price of ₹285.20, with the company maintaining a market capitalization of ₹24,978 crores.

Company Denies Delay Reports

Through a regulatory filing dated January 9th, Manappuram Finance categorically refuted a media report titled "Manappuram's Bain deal delayed by Indian regulatory concerns," calling it factually incorrect and speculative. The company emphasized that it has been regularly updating stock exchanges about the proposed investment by BC Asia Investments XIV Limited and BC Asia Investments XXV Limited.

Transaction Details

The acquisition involves BC Asia Investments XIV Limited and BC Asia Investments XXV Limited acquiring joint control alongside the company's existing promoters in Manappuram Finance and its subsidiaries. The deal encompasses key subsidiaries including Asirvad Micro Finance Limited (AMFL) and Manappuram Home Finance Limited (MHFL). The company confirmed that all required submissions, along with responses to RBI's clarifications, have been duly filed.

Financial Performance Overview

Despite the positive market response to the clarification, Manappuram Finance's recent financial results showed mixed performance. The company experienced a significant decline in revenue from operations during Q2 FY26.

Business Profile and Growth

Manappuram Finance Limited operates as a Systemically Important Non-Deposit Taking Non-Banking Financial Company (NBFC-ND-SI) and has been classified as NBFC-ML (Middle layer) by the RBI under Scale Based Regulation. The company provides a comprehensive range of fund-based and fee-based financial services including:

• Gold loans
• Commercial and passenger vehicle financing
• Construction and farm equipment financing
• MSME financing
• Two-wheeler and personal loans
• Foreign exchange services

Despite recent financial challenges, the stock has delivered impressive returns of over 72% in the past year and gained approximately 3% in the last month, reflecting investor confidence in the company's long-term prospects and the potential Bain Capital partnership.