Muthoot Finance Q2 Profit Jumps 36% to ₹3,278 Crore on Loan Growth

Muthoot Finance, a leading non-banking financial company specializing in gold loans, announced a significant increase in its consolidated profit after tax (PAT) for the second quarter of the financial year 2026-27. The company’s PAT rose by 36 percent year-on-year, reaching ₹3,278 crore during July to September 2026. This growth was largely fueled by the expansion of its loan portfolio, particularly in the gold loan segment.

The firm’s consolidated total income also saw a notable rise, climbing 37 percent year-on-year to ₹10,011 crore for the quarter. Interest income, a key revenue component, increased by 39 percent, amounting to ₹9,856 crore. These figures reflect the strong demand for secured credit products, especially gold-backed loans, which remain a cornerstone of Muthoot Finance’s business model.

Assets under management (AUM) for the group’s loan portfolio grew by 42 percent compared to the same period last year, reaching ₹2.09 trillion as of September 30, 2026. This compares with ₹1.48 trillion reported a year earlier, highlighting the company’s ongoing ability to attract and service a growing customer base.

On a standalone level, Muthoot Finance’s performance was similarly robust. The company’s PAT increased by 27 percent to ₹2,977 crore in Q2 FY27, up from ₹2,345 crore in the corresponding quarter of the previous year. Standalone interest income expanded 38 percent to ₹8,730 crore, while total income rose 37 percent to ₹8,842 crore. The standalone loan AUM mirrored the consolidated growth, increasing 42 percent to ₹1.88 trillion, with gold loans accounting for ₹1.79 trillion, a 43 percent increase. Other types of loans also grew by 20 percent, reaching ₹8,854 crore.

Despite these positive results, the company noted a rise in impairment on financial instruments, which grew to ₹515 crore from ₹95 crore in the year-ago quarter. Finance costs also increased by 46 percent, totaling ₹3,365 crore, reflecting higher borrowing expenses amid expansion.

For the first half of FY27, Muthoot Finance’s consolidated PAT stood at ₹6,103 crore, marking a 39 percent increase year-on-year. Consolidated total income for the period rose 36 percent to ₹18,706 crore. The group’s branch network expanded slightly, increasing from 7,524 to 7,904 branches during the year, supporting wider customer reach.

The company’s subsidiaries showed encouraging trends as well. Muthoot Money reported a PAT of ₹191 crore in Q2 FY27, almost tripling from ₹69 crore in the same quarter the previous year. Its loan AUM nearly doubled to ₹12,716 crore. Belstar Microfinance turned profitable with a ₹78 crore profit compared to a loss of ₹32 crore in Q2 FY26. The Sri Lankan subsidiary, Asia Asset Finance, posted a PAT of ₹12 crore, doubling from ₹6 crore a year earlier.

George Alexander Muthoot, executive vice-chairman, emphasized the company’s strong footing this fiscal year. He pointed out that consolidated loan AUM reached a record ₹2.09 trillion in Q2, up 42 percent year-on-year. He highlighted the continuing opportunities in India’s gold loan market driven by increasing demand for secured credit and greater formalization of borrowing.

Muthoot also mentioned the microfinance arm’s ongoing turnaround and diversification into gold loans, noting that Belstar has opened 163 gold loan branches so far. The merger of Muthoot Money, now focused solely on gold loans, is expected to enhance operational and financial efficiencies. With a large and growing branch network and extensive expertise in gold loan products, the company is positioned to maintain its leadership and sustain growth throughout FY27 and beyond.

This performance reflects broader trends in the Indian financial market where secured lending, particularly against gold, remains a preferred borrowing option for many consumers. Muthoot Finance’s continued expansion underscores the resilience and potential of this segment within the NBFC sector.