Muthoot Finance had a strong performance in the second quarter of FY25, with a 28% year-on-year growth in gold loans, reaching INR 862 billion. The net interest margins remained stable at around 11.8%. The company"s profit after tax (PAT) for the quarter increased by 26% year-on-year to approximately INR 12.5 billion, in line with expectations.

The first half of FY25 saw a PAT growth of 18% year-on-year to INR 23.3 billion, and projections suggest a 35% growth in the second half. The gold tonnage rose by 3% quarter-on-quarter to 199 tonnes, and the customer base increased by 4% to approximately 6.14 million. Despite a 15% increase in operating expenses, the cost-to-income ratio improved to about 26%, down from 30% in the previous year.

Muthoot Finance"s return on assets and return on equity stood at 5.7% and 20.0%, respectively. However, analysts from Motilal Oswal have reiterated a Neutral rating on the stock, stating that the positive factors are already reflected in its valuations. They have set a revised target price of INR 1,815, based on a price-to-book value of 2x for September 2026 estimates.