 "Manappuram Finance")
The company’s provision for bad loans jumped 80 per cent to Rs 229 crore.
Indian gold-loan provider Manappuram Finance reported a first-quarter profit rise on Tuesday, helped by strong gold-loan growth.
The company’s consolidated net profit attributable to owners rose about 12 per cent to Rs 555 crore ($66 million) for the three months ended June 30, in line with analysts’ expectations, according to LSEG data.
Benchmark spot gold prices have risen more than 20 per cent as of June-end from a year ago, hitting record highs, bolstering loan growth for lenders such as Manappuram.
Rising prices of bullion benefit gold financiers by increasing the value of pledged gold collateral, and driving growth as more customers seek loans against their higher-valued assets.
Analysts expect Manappuram to also have benefited from a regulatory ban on key competitor IIFL Finance disbursing gold loans.
Revenue from Manappuram’s gold loan and other businesses rose 23.5 per cent to Rs 1,737 crore, while its microfinance arm posted a near 18 per cent revenue growth to Rs 775 crore.
Its assets under management rose 21.2 per cent year-on-year to Rs 44,900 crore.
Finance cost rose about 31 per cent, leading to a near 28 per cent rise in total expenses, after India’s central bank raised risk weights for bank loans given to non-banking financial companies.
The company’s provision for bad loans jumped 80 per cent to Rs 229 crore.
Larger rival Muthoot Finance posted an 11 per cent rise in first-quarter profit but missed analysts’ estimates.
(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
First Published: Aug 13 2024 | 5:42 PM IST
