The newly assigned goal costs mirror a wholesome 19% upside within the inventory from its closing value on Wednesday.
Moreover, after the outcomes, the inventory surged 11.3% to its new 52-week excessive of Rs 2,793.65 on the BSE.
Right here’s an in depth have a look at what these brokerage corporations mentioned:
Jefferies: Purchase| Goal value: Rs 2,950
Jefferies has maintained its ‘Purchase’ score on Muthoot Finance whereas growing its goal value to Rs 2,950 from Rs 2,660, valuing the inventory at 2.7x September 2027 estimated e book worth. The brokerage highlighted the corporate’s 90% YoY progress in standalone revenue to Rs 2,046 crore, pushed by sturdy gold mortgage progress, margin growth, and NPA recoveries.
In response to Jefferies, Muthoot Finance’s Q1 efficiency benefited from a beneficial macro setting for gold loans, with AUM up 42% YoY and loan-to-value (LTV) ratios providing headroom for additional progress. Margins improved sequentially, with the web curiosity margin (NIM) rising by 88 foundation factors to 12.2%. This was aided by recoveries totalling Rs 3.5 billion, together with Rs 1 billion from asset reconstruction firms, and the remaining from non-performing mortgage settlements.The brokerage additionally famous that whereas loans are largely fixed-rate, about half of borrowings are floating and principally linked to MCLR, implying some lag in value repricing. Jefferies expects Muthoot to ship a 23% revenue CAGR with return on fairness (ROE) exceeding 21% over FY26–28, supported by regular mortgage progress, managed credit score prices, and restricted mortgage losses.
Nuvama: Purchase| Goal value: Rs 2,993
Nuvama has additionally reiterated its ‘Purchase’ suggestion, elevating its goal value to Rs 2,993 from Rs 2,625, primarily based on a 3.4x FY26 estimated e book worth. The brokerage described Muthoot’s Q1FY26 as a “sturdy all-round beat,” considerably outperforming friends throughout progress, profitability, and asset high quality metrics.
Nuvama identified that consolidated AUM rose 10% QoQ and 42% YoY, with gold AUM alone rising 40% YoY and 10% QoQ. Margins expanded by 88 foundation factors sequentially, aided by recoveries from each NPL settlements and ARC transactions. Even excluding recoveries, yields remained regular, not like the declines seen amongst different lenders within the sector.
The brokerage additionally highlighted the corporate’s environment friendly value administration and vital discount in credit score prices in the course of the quarter. Recoveries of Rs 3.5 billion, together with Rs 1 billion from ARC gross sales, straight contributed to yield enchancment. Moreover, subsidiaries’ rising contribution to the gold mortgage enterprise is predicted to help total momentum. Nuvama added that administration stays assured in sustaining each yield and progress ranges going ahead.
Muthoot Finance Q1 outcomes
Muthoot Finance on Wednesday reported a consolidated internet revenue of Rs 1,974 crore for the quarter ended June 30, 2025, up 65% from Rs 1,196 crore within the corresponding interval final 12 months.
Sequentially, revenue rose 37% from Rs 1,444 crore in Q4FY25. The lender’s consolidated mortgage property underneath administration (AUM) reached a document Rs 1,33,938 crore, representing a 37% year-on-year improve and a ten% rise from the earlier quarter.
Gold mortgage AUM, a key enterprise section for the corporate, grew 40% YoY to Rs 1,13,194 crore, marking its highest annual progress on this section to this point.
The corporate additionally reported different operational highlights in the course of the quarter, together with crossing the Rs 1 trillion market capitalisation milestone, opening 22 new branches, and successful six awards on the E4M Golden Mikes, such because the Golden Class award for Greatest Built-in TV Marketing campaign and the Silver Class award for Greatest Use of Influencers/Celebrities on TV for its ‘Sunheri Soch’ Season 3 marketing campaign.
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(Disclaimer: Suggestions, recommendations, views and opinions given by the specialists are their very own. These don’t symbolize the views of The Financial Occasions)
