Muthoot Finance Q2FY23 Financial Results

Key Highlights

Opened 24 branches in Q2 FY23

Partnered with LuLu International Exchange to provide UAE customers with easy gold loan repayment services

First NBFC to launch Milligram Gold Programme – a gold reward program for its customers

CSR Initiative- ‘Cup of Life’, entered the Guinness World Records by distributing 1 lakh free menstrual cups across 126 venues in 24 hours. The program aimed at eradicating the menstrual taboos and spreading menstrual awareness in the society.

A meeting of the Board of Directors of Muthoot Finance Ltd. was held today to consider and approve the unaudited standalone and consolidated results for the quarter ended September 30, 2022.

Consolidated Results of Muthoot Finance Ltd

Muthoot Finance Ltd Consolidated Loan Assets under management grew 6% YoY to Rs. 64,356 crores as at H1 FY23 as against Rs. 60,919 crores last year. During the quarter, Consolidated Loan Assets under management increased by Rs. 912 crores i.e. an increase of 1% QoQ. Consolidated Profit after tax for H1 FY23 stood at Rs. 1,727 crores as against Rs. 1,981 crores last year. Consolidated Profit after tax for Q2 FY23 increased by 9% QoQ at Rs. 902 crores as against Rs. 825 crores in Q1 FY23.

Commenting on the results, Mr. George Jacob Muthoot, Chairman stated, “We delivered another quarter of excellent performance by achieving a consolidated loan assets growth of 6% YoY reaching Rs. 64,356 crores. Consolidated Profit after Tax also saw an increase of 9% QoQ for Q2 FY 23 at Rs.902crores.  The contribution of our subsidiaries to the overall consolidated AUM remain at 11%. Our Microfinance Subsidiary, Belstar has registered a remarkable YoY Loan growth of 53% with AUM at Rs.5138 crores. We are also witnessing improved collections across micro finance, vehicle finance and home loans. We continue to monitor these sectors for emerging opportunities with an objective to drive a balanced business growth.”

Mr. George Alexander Muthoot, Managing Director said, " Our gold loan AUM stood at Rs.56,501crores registering a YOY growth of 3% and a slight QoQ growth. The standalone profit after tax increased by 8% QoQ for Q2 FY23 at Rs.867crs.  Though we were able to migrate teaser loans to higher rates, full impact transformation will take few more quarters.  Further despite the rising interest rate scenario, we were able to maintain our borrowing cost at 7.98% for Q2FY23. In the coming quarters, we expect the borrowing cost to remain in that range mainly due to the positive impact on account of retirement of ECB amounting to USD450million in October 2022 which carried a high cost.  We expect that our improved focus on loan disbursements and recovery measures as well as borrowing cost will enable us to maintain NIM around 11-12%. We continue to invest in our various digital initiatives along with our Gold loan@home service. We will continue to work on strengthening our growth strategy with focus on branch expansion and digital strategy”

Standalone Results of Muthoot Finance Ltd and its subsidiaries

Muthoot Finance Ltd (MFIN), India’s largest gold loan company in terms of loan portfolio, registered a net profit of Rs. 867 crores in Q2 FY23 as against Rs. 802 inQ1 FY23, an increase of 8% QoQ. The net profit stood at  Rs. 1,669 crores in H1 FY23 as against Rs. 1,965 crores in H1 FY22. Loan Assets increased to Rs. 57,230 crores as compared to Rs. 55,147 crores last year, registering a growth of 4% YoY. During the quarter, loan assets increased   by Rs. 541 crores, an increase of 1%.

Muthoot Homefin (India) Ltd (MHIL), the wholly owned subsidiary of Muthoot Finance, loan portfolio stood at Rs.1,420 crores for H1 FY23. Total revenue for Q2 FY23 & H1 FY23 stood at Rs. 39 crores & Rs. 75 crores respectively. It achieved a Profit after tax of Rs.2 crores & Rs.4 crores in Q2 FY23 & H1 FY23 respectively. Stage III Asset as percentage of Net Loan Assets stood at 4.33% as on September 30, 2022 as compared to 3.52% as of June 30, 2022.

M/s. Belstar Microfinance Limited (BML), is an RBI registered micro finance NBFC and a subsidiary company where Muthoot Finance holds 56.97% stake. Loan portfolio for H1 FY23 increased to Rs. 5,138 crores as against Rs. 3,354 crores for H1 FY22, an increase of 53% YoY. Total revenue for Q2 FY23 & H1 FY23 stood at Rs. 245 crores & Rs. 455 crores respectively. It achieved Profit after tax of Rs. 21 crores & Rs. 35 crores in Q2 FY23 & H1 FY23 respectively. Stage III Asset as percentage of Net Loan Assets stood at 8.52% as of September 30, 2022 as compared to 8.57% as of June 30, 2022..

Muthoot Insurance Brokers Pvt Limited (MIBPL), an IRDA registered Direct Broker in insurance products and a wholly owned subsidiary company generated a total premium collection amounting to Rs.152 crores & Rs.283 crores in Q2 FY23 and  H1 FY23 respectively. Total revenue for Q2 FY23 & H1 FY23 increased to Rs. 14 crores & Rs.25 crores as against Rs. 11 crores & Rs. 17 crores respectively in Q2 FY22 & H1 FY22. It achieved a Profit after tax of Rs. 9 crores & Rs. 16 crores in Q2 FY23 & H1 FY23 respectively.

Asia Asset Finance PLC (AAF) is a subsidiary based in Sri Lanka where Muthoot Finance holds 72.92% stake. Loan portfolio  grew to LKR 1,930 crores as against LKR 1,457 crores last year, an increase of 32% YoY. Total revenue for Q2 FY23 & H1 FY23 stood at LKR 148 crores & LKR 263 crores respectively. It achieved a Profit after tax of LKR 10 crores & LKR 15 crores in Q2 FY23 and        H1 FY23 respectively.

Muthoot Money Ltd (MML)  is a wholly owned subsidiary of Muthoot Finance Ltd . MML is a RBI registered Non-Banking Finance Company engaged mainly in extending loans for Commercial Vehicles and Equipment. Loan portfolio stood at Rs.234 crores for half year ended FY23. Total revenue for Q2 FY23 & H1 FY23 stood at Rs. 12 crores & Rs.24 crores respectively. It achieved a Profit after tax of Rs. 0.19 crores & Rs. 0.24 crores each in Q2 FY23 & H1 FY23. It’s Stage III Asset on Gross Loan Asset as on September 30, 2022 stood at 5.63%.

Financial Highlights (MFIN): Standalone results for Muthoot Finance Ltd.

Business Highlights (MFIN):