Muthoot Finance shares experienced a significant increase of almost 8% on November 18 due to strong quarterly profit growth and a notable rise in assets under management (AUM), which exceeded Rs 1 lakh crore.

The company's AUM grew by 31% compared to the previous year, reaching Rs 1.04 lakh crore, with gold loan AUM reaching a record high of Rs 86,164 crore. This growth can be attributed to the high demand for gold loans, especially after the Reserve Bank of India implemented stricter regulations on unsecured lending. George Alexander Muthoot emphasized the increase in gold loan activity, as most loans are repaid within the first six months.

Bernstein has maintained an Outperform rating on Muthoot Finance and set a price target of Rs 2,000, while Morgan Stanley upgraded its stance from Underweight to Equal Weight, citing an improving environment for the microfinance institution. However, Morgan Stanley also mentioned some concerns specific to the sector that could impact future performance.