According to reports from ET Now and CNBC TV18, Muthoot Finance delivered exceptional quarterly performance in Q4FY26, with gold loans continuing to be the primary engine of growth. The company reported a sharp rise in gold loan assets under management (AUM), which jumped nearly 54% year-on-year to ₹1.54 lakh crore. The surge in gold loan growth translated into robust financial performance, with total AUM rising to ₹1.63 lakh crore, marking a 50% jump from the year-ago period. Net interest income (NII) climbed nearly 79% YoY to ₹5,194 crore, while profit after tax more than doubled to ₹3,086 crore. As per the latest analyst call recording, consolidated PAT nearly doubled, rising 98% year-on-year to ₹106,069 Mn, while standalone PAT grew 95% YoY to ₹101,341 Mn. Looking ahead, Muthoot Finance has indicated expectations of about 15% growth in Q1, reflecting continued momentum in its core lending business. The company has also signaled that it may update its growth guidance starting from Q2, indicating a measured approach to forecasting amid evolving market conditions.
As reported by ET Now, the key driver behind this performance was the significant rise in gold prices, which boosted the underlying value of collateral. The rally in gold, supported by global uncertainty, expectations of lower interest rates and safe-haven demand, lifted lending volumes in value terms even as physical gold tonnage declined. The company's gold holdings fell about 4% sequentially to 196 tonnes, indicating that growth was largely price-led rather than volume-driven. Gold prices rose roughly 65% year-on-year, significantly impacting the company's operations. With gold prices showing recent correction, analysts are now questioning how a sustained decline in gold prices might impact the company's LTV ratios, AUM growth trajectory, and NIM expansion expected through FY27-28.
According to ET Now, margins saw notable expansion during the quarter with the company's yield on gold loans improving. This led to a widening in spreads by nearly 60 basis points quarter-on-quarter to 12.5%. Net interest margins rose to 13.38%, supported by higher lending rates across select schemes and relatively stable funding costs. The company continued expanding its footprint, adding 177 new gold loan branches during the year. Despite this expansion, the active customer base saw a marginal decline sequentially to 6.41 million, suggesting incremental growth is being driven more by higher ticket sizes and gold prices rather than new borrower additions. Key profitability ratios showed strong improvement, with Net Interest Margin (NIM) rising to 12.75% in FY 2026 from 11.45% in FY 2025.
As reported by ET Now, on an asset quality basis, Q4 Gross Non-Performing Assets (GNPA) rose to 2.35% from 1.58% on a quarter-on-quarter basis, while Net NPA (NNPA) increased to 2.04% from 1.30% QoQ. The Stage III loan assets stood at 2.35% of total loan assets, improving from 3.41% in March 2025, and ECL provision as a percentage of loan assets improved to 1.10% from 1.45%. Given the sharp QoQ rise in GNPA from 1.58% to 2.35% in Q4 FY26, analysts are questioning whether tightening RBI regulations on gold loan classification could further pressure asset quality metrics in FY27. The rise in Stage 2/3 loans was largely attributed to regulatory classification changes rather than underlying credit deterioration.
According to CNBC TV18, Muthoot Finance addressed recent government commentary on gold, noting that the remarks are expected to have a greater impact on jewelers rather than gold loan companies. This distinction is significant, as it suggests the regulatory or policy environment stemming from these comments is seen as posing a relatively lower risk to the gold loan financing segment compared to the jewellery trade. The company remains optimistic about the outlook for the gold loan segment, with management guiding for around 15% growth in gold AUM in the near term and plans to open nearly 200 new branches each in its core business and subsidiary operations. Multiple global brokerages have reaffirmed positive outlook following the strong Q4 results, with CLSA citing a 30% beat on Q4 PAT and raising FY27 PAT estimates by 15%. Jefferies expects higher gold prices, branch expansion, and operating leverage to drive 15% EPS CAGR and 25% ROE over FY26–28. The company's market capitalisation stood at ₹1,268,681 Mn as of March 31, 2026, with EPS of ₹252.43 and book value per share of ₹940.05.
