Muthoot Microfin's loan book grows 18% as lending picks up in Q1

Muthoot Microfin Ltd. on Thursday, July 9, reported an 18% year-on-year increase in assets under management (AUM) for the June quarter, driven by strong disbursement growth and improving collection efficiency.

The company's AUM rose to ₹14,457 crore as of June 30, compared with a year earlier, and was up 3% sequentially from the March quarter.

Disbursements during the quarter increased 49% year-on-year to ₹2,645 crore. The company also commenced gold loan disbursements under a referral and co-lending arrangement with parent Muthoot Fincorp, disbursing ₹192.86 crore during the quarter.

Collection efficiency improved to 97.97% in Q1FY27 from 93% a year ago and 96.43% in the March quarter. The company's X-Bucket collection efficiency stood at 99.89%, reflecting stronger recoveries.

The Small and Micro Enterprise Individual Loan portfolio expanded to ₹3,214 crore, while the mix between Joint Liability Group (JLG) and Non-JLG loans improved to 76:24, compared with 83:17 in the preceding quarter.

As of June 30, the company operated 1,671 branches and served 33 lakh active customers across the country.

During the quarter, CRISIL upgraded Muthoot Microfin's long-term credit rating to AA-/Stable from A+/Positive, reflecting an improvement in its credit profile.

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The company said the operational figures are provisional and remain subject to review by its statutory auditors and approval by the audit committee and board of directors.

Shares of Muthoot Microfin Ltd. ended 1.8% higher at ₹210.10 ahead of the business update. The stock has gained 22% so far this year and is up around 31% over the past 12 months.