Muthoot Finance Ltd. share price target

Muthoot Finance's Q1FY19 numbers have beaten our estimates. There has been a revival in the Standalone gold loan AUM growth of 6% QoQ and 11% YoY. NII and PAT growth of 31% and 43% is 10% and 14% ahead of our expectations respectively. Asset quality has improved with GNPA easing by 240bps sequentially to 4.6%. We retain our Buy rating on the stock with a target price of Rs595, valuing it at 2.5x P/ABV FY20. We have yet not assigned any value to its subsidiaries....

Muthoot Finances (MUTH) 1QFY19 PAT grew 43% YoY to INR4.9b, driven by a pick-up in loan growth, a reduction in GNPLs and a lower C/I ratio. 5 September 2018 With interest write-backs on account of declining GNPLs and lower cost of funds, NII increased 31% YoY. Note that next quarter onward, the base for cost of funds will become unfavorable and MUTH is likely to witness a sharp increase in cost of funds thereafter. MUTH raised INR30b worth of NCDs in a private placement during the quarter. Under Ind-AS, 1QFY18 PAT was 2% lower; FY17 networth was unchanged. Muthoot Homefin increased its loan book almost 3x to INR16b, with PAT up ~3x to INR110m. Belstars loan book grew 86% YoY to INR12b, with PAT almost tripling to INR140m. We increase our FY19/20 estimates by ~15% to factor in stronger growth and lower credit costs under Ind-AS.

NII grew 52%/36% YoY/QoQ to INR11.5b, largely led by 440bp QoQ expansion in NIM (calculated) to 17%. This was driven by a 380bp QoQ rise in calculated yields to 24% and a 100bp decline in cost of funds to 8.8%. The company witnessed strong penal interest collections from overdue accounts, which resulted in a sharp spike in yields. Branch rationalization and lower employee count led to a 900bp sequential...

Operating Income decreased by 18.56% to Rs. 1392.26 Cr in Q1FY18 when compared to the previous quarter Operating Income decreased by 18.56% to Rs. 1392.26 Cr in Q1FY18 when compared to the previous quarter

Operating Income rose by 28.26% to Rs. 1696.16 Cr in Q4FY17 when compared to the previous quarter.

Muthoot Finance Ltd, the largest gold financing company in India in terms of loan portfolio, registered an increase in net profit of 48%, at 270 crs for the quarter ended June 2016 as against 183 crs in last year. Retail loans registered an increase of 1481cr during the quarter as against 1000 cr in last year translating to an increase in growth rate by...

Muthoot Finance's (MUTH) reported PAT for 1QFY17 grew by 48% YoY and 2% QoQ to INR2.70b (24% beat v/s our estimate of INR2.18b). The strong performance was led by a revival in AUM growth (+6% QoQ) and improvement in yields on the back of lower auction losses. Firm gold prices helped the company to settle recoveries from overdue accounts. Share of overdue accounts declined from 25% in 3QFY16 to 13% in 4QFY16 and to 8% in 1QFY16 led by collection efforts. AUM for the quarter stood at INR258.6b, up 5.9% YoY and 6.1% QoQ. Management has turned optimistic on 6% QoQ growth achieved this quarter, and...