The Kerala-based Muthoot Finance has reported record performance for the second quarter of 2025-26 and moved to raise its funding sources, with the board approving plans to raise up to ₹35,000 crore through non-convertible debentures (NCDs).
Muthoot Finance, India’s largest gold loan NBFC, posted an 87 percent year-on-year rise in standalone net profit to ₹2,345 crore, driven by record gold loan disbursements and a sharp increase in interest income. Standalone operating revenue climbed 56 percent to ₹6,432 crore, with interest income rising 55 percent to ₹6,304 crore.
Riding on the robust momentum, the company has doubled its full-year disbursement growth guidance to 30–35 percent.
“We are upgrading our FY26 gold loan growth guidance from 15 percent to 30–35 percent,” managing director George Alexander Muthoot said. He attributed the improved outlook to favourable RBI regulatory updates for gold loans, higher gold prices, and tighter norms for unsecured credit, which are expected to push more customers towards secured gold-backed borrowing.
The standalone loan AUM (assets under management) hit an all-time high of ₹1.32 lakh-crore as of H1FY26, up 47 percent year-on-year. Gold loan AUM touched ₹1.25 lakh crore, registering a 45 percent jump. In Q2 alone, gold loan AUM rose ₹11,723 crore, a sequential growth of 10 percent.
At the consolidated level, net profit rose 83 percent year-on-year to a record ₹2,417 crore, while interest income increased 48 percent to ₹7,091 crore. Consolidated loan AUM touched ₹1.48 lakh crore, expanding by ₹25,493 crore—a 21 percent rise during the first half of FY26.
The consolidated numbers include contributions from Muthoot Homefin, Belstar Microfinance, and Muthoot Insurance Brokers, in addition to the core gold loan business.
Muthoot said it would continue expanding its non-gold loan segments—personal, home, and business loans—while keeping their share, including microfinance, within 12–15 percent of the consolidated portfolio.
Belstar Microfinance posted a ₹32-crore loss, compared with a ₹53-crore profit a year earlier. However, the loss narrowed from the previous quarter’s ₹128-crore setback. Revenue fell to ₹426 crore from ₹592 crore last year, while Stage 3 loans inched up to 4.58 percent.
Following RBI’s approval allowing MFIs to diversify up to 40 percent of their portfolios into non-microfinance products, Belstar opened 23 gold loan branches in H1FY26. Its loan AUM dropped to ₹7,771 crore, from ₹9,625 crore a year earlier.
Muthoot Money delivered a turnaround, with its loan book tripling to ₹6,393 crore. Revenue jumped to ₹288 crore from ₹85 crore, while the entity posted a ₹69-crore profit versus a ₹4-crore loss in the previous year. The board has cleared an equity infusion of ₹500 crore into the business to support further expansion.
With gold loan demand at record levels and disbursement trends staying strong, the ₹35,000-crore NCD will give Muthoot Finance the firepower to maintain loan growth, diversify liabilities, and strengthen liquidity buffers in a rising-credit environment.
The combination of higher gold prices, supportive regulations, and an economic shift towards secured retail lending has placed the company in a favourable position to scale further in FY26.