Moody’s Ratings has announced an upgrade in Muthoot Finance’s credit rating, highlighting the company’s solid financial standing and leadership in the gold loan sector in India. The agency cited Muthoot’s robust risk management strategies and operational efficiency as key factors in maintaining steady loan growth and strong asset quality.
Despite facing stiff competition from banks and other financial institutions, Muthoot Finance has consistently upheld stringent underwriting standards. This disciplined approach has contributed to the company’s stability and continued expansion in the gold financing industry.
Muthoot Finance stands out as one of the most profitable finance companies in India. In the nine months leading up to December 2024, the company’s net income to average managed assets reached 4.9%. This impressive performance was driven by a high net interest margin and minimal credit costs associated with its gold loan portfolio. Additionally, the company’s strong profitability has bolstered its internal capitalization, with a tangible common equity to total managed assets (TCE/TMA) ratio of approximately 23.3% as of December 2024.
Managing Director’s Response
George Alexander Muthoot, Managing Director of Muthoot Finance, expressed his satisfaction with the rating upgrade, stating:
“We are delighted that Moody’s Ratings has upgraded our long-term corporate family rating from Ba2 to Ba1. This recognition underscores our financial strength, stable asset quality, and resilient business framework. Moody’s assessment reflects our prudent risk management practices, sustained profitability, and well-diversified funding strategy.
Our ability to navigate market fluctuations while maintaining operational efficiency has been acknowledged through this rating enhancement. This achievement is a testament to the dedication of our employees, the trust of our customers, and the unwavering support of our stakeholders. We remain committed to driving sustainable growth, creating value for our stakeholders, and upholding our leadership in the financial services industry.
We extend our sincere appreciation to our stakeholders for their continued confidence in Muthoot Finance. Moving forward, we will persist in our efforts to maintain excellence, uphold ethical governance, and strengthen our market position.”
Additional Recognition from S&P Global Ratings
Further cementing its financial stability, Muthoot Finance has also secured an upgrade from S&P Global Ratings. The agency raised the company’s rating to ‘BB+’ with a ‘Stable’ outlook, reinforcing its credibility and strong position in the financial services sector.
