17 June 2020 Muthoot Finances (MUTH) 4QFY20 PAT surged 59% YoY to INR8.2b (in- line), driven by strong AUM growth and improvement in asset quality. In FY20, MUTH delivered growth of 22%/34%/53% for loans/PPoP/PAT. RoA/RoE for the year stood at 6.8%/29%. However, given the uncertain outlook for MUTHs subsidiaries and the re-rating in the stock, we maintain with TP of INR1,100. spreads were up 200bp YoY due to higher penal interest and lower cost of funds (down 80bp YoY). GS3% declined 40bp QoQ to 2.16%. The company made INR48m provisions during the quarter. Similar to 3QFY20, MUTH raised USD550m via ECBs in the quarter. Opex jumped 17% QoQ due to an accounting treatment on hedging cost for the ECBs raised. Customer footfall at 65-70% of run-rate now. Disbursements declined ~40% QoQ to INR583m.