Manappuram Finance Shines With Strong Quarterly Profits

What’s going on here?

Manappuram Finance reported a 36% rise in fourth-quarter net

profit

, reaching 5.62 billion rupees ($67.7 million), beating analysts’ predictions.

What does this mean?

Manappuram Finance’s strong performance is driven by robust loan growth across its gold and non-gold segments. The non-gold portfolio now represents 49% of total assets under management (AUM), thanks to high demand in microfinance, auto, and housing loan sectors, while gold loans hold steady at 51%. The surge in borrowing against gold followed a 22% rise in benchmark spot gold prices during the January-March period. The company’s total AUM grew 19% to 421 billion rupees, as consolidated

interest

income jumped 32% to 22.73 billion rupees. However, expenses also rose by 31% due to higher finance costs.

Why should I care?

For markets: Rising costs meet solid returns.

Despite high interest rates and tighter liquidity conditions, Manappuram Finance’s strong loan growth suggests robust

consumer

spending. Shareholders have responded positively, with the

stock

ending 1.04% higher post-announcement and rising approximately 5% year-to-date. Meanwhile, the sector’s attention now turns to Manappuram’s bigger rival, Muthoot Finance, which will reveal its own results on May 30.

The bigger picture: Navigating regulatory waters.

Indian regulators are ramping up oversight of banks and NBFCs, evidenced by the Reserve Bank of India (RBI) halting IIFL Finance’s gold loan disbursements due to supervisory concerns. Manappuram Finance’s strong performance amid increased scrutiny highlights its resilience and could signify a bullish outlook for well-managed firms in the NBFC sector.