Muthoot Finance shares reached record high levels on Wednesday, as the global gold price rally continues to fuel significant gains in the stock. The company is experiencing its strongest performance since listing, with shares trading 1.9% higher at ₹3,879 during the day's session.

Record-Breaking Annual Performance

The stock has delivered exceptional returns, marking a milestone year for investors. The performance metrics highlight the company's strong momentum in recent years.

This 81.00% gain represents the best calendar year return since the company's listing in 2011, surpassing the previous record of 78.00% achieved in 2014. The stock has now delivered positive returns for three consecutive years, demonstrating consistent growth momentum.

Global Gold Market Dynamics

The surge in Muthoot Finance shares directly correlates with record-high global gold prices. Several factors are driving this unprecedented rally in precious metals markets. Renewed geopolitical tensions between the US and Venezuela have increased safe-haven demand for gold. Additionally, market expectations of further monetary easing by a potentially more dovish Federal Reserve when a new Chair takes charge are supporting gold prices.

Robust ETF inflows and continued buying from global central banks are providing additional support to gold prices. In Indian markets, gold futures on the MCX are nearing ₹1.40 lakh per 10 grams, reflecting the global trend in domestic pricing.

Strong Financial Performance

The company's recent quarterly results demonstrate robust operational performance across key metrics. Financial highlights from the most recent quarter show significant growth in profitability and core income.

The gold loan business represents the dominant portion of the company's operations, with ₹1.24 lakh crore in assets under management comprising well over 90% of the consolidated AUM of ₹1.47 lakh crore at the end of the September quarter.

Management Outlook and Analyst Recommendations

Management confidence in the business trajectory is evident through revised growth projections. The company has significantly upgraded its growth outlook for the year to between 30% and 35%, representing a substantial increase from the earlier guidance of 15%.

Brokerage firm Jefferies has maintained its positive stance on the stock, continuing its "buy" rating with a price target of ₹4,000. The firm expects Muthoot's margins to expand alongside easing credit costs, supporting the bullish outlook.

The stock's momentum remains strong, with shares up for the fifth straight month in December, reflecting sustained investor confidence in the company's gold-backed lending business model amid favorable market conditions.

Muthoot Finance , one of India's leading gold loan NBFCs, has reported a remarkable financial performance for the half-year ended September 2025, with a significant boost in profitability and loan assets under management. The company has also revised its growth outlook for gold loans, citing favorable market conditions.

Financial Highlights

• Profit After Tax: Muthoot Finance's standalone profit after tax jumped by 88% year-on-year to Rs. 4,391.00 crores for the half-year period.
• Loan Assets Under Management: The company witnessed a robust 47% growth in loan assets under management, reaching Rs. 1,32,305.00 crores.
• Quarterly Performance: For the quarter ended September 2025, the company reported a net profit of Rs. 2,345.20 crores, marking a 14.61% increase from the previous quarter and an 87.45% rise from the same quarter last year.

Upgraded Growth Guidance

Muthoot Finance has revised its gold loan growth guidance for the financial year 2026:

• Previous Guidance: 50% growth
• Updated Guidance: 30%-35% growth

The company attributes this optimistic outlook to several factors:

1. Favorable regulatory changes
2. Higher gold prices
3. Tighter norms for unsecured credit

Financial Performance Analysis

The company's financial metrics show strong growth across all key areas, with significant year-on-year improvements in revenue, EBITDA, and net profit.

Operational Efficiency

Muthoot Finance has maintained a high operating profit margin (OPM) of 84.9% in the latest quarter, indicating efficient management of operational costs despite the rapid growth in loan assets.

Market Position and Future Outlook

The substantial growth in loan assets under management and the upgraded growth guidance for gold loans suggest that Muthoot Finance is well-positioned to capitalize on the current market dynamics. The company's focus on gold loans, coupled with favorable external factors such as regulatory changes and higher gold prices, appears to be driving its robust financial performance.

As the company continues to expand its loan book and maintain strong profitability, investors and market watchers will likely keep a close eye on Muthoot Finance's ability to sustain this growth trajectory in the coming quarters, especially given the evolving landscape of the NBFC sector and the gold loan market in India.