MUTHOOTFIN - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 3.9
| Stock Code | MUTHOOTFIN | Market Cap | 1,37,471 Cr. | Current Price | 3,424 ₹ | High / Low | 4,150 ₹ |
| Stock P/E | 16.1 | Book Value | 859 ₹ | Dividend Yield | 0.88 % | ROCE | 13.4 % |
| ROE | 19.7 % | Face Value | 10.0 ₹ | DMA 50 | 3,473 ₹ | DMA 200 | 3,274 ₹ |
| Chg in FII Hold | 0.56 % | Chg in DII Hold | -0.70 % | PAT Qtr | 2,656 Cr. | PAT Prev Qtr | 2,345 Cr. |
| RSI | 47.2 | MACD | 25.6 | Volume | 4,40,178 | Avg Vol 1Wk | 4,22,097 |
| Low price | 2,027 ₹ | High price | 4,150 ₹ | PEG Ratio | 1.68 | Debt to equity | 3.69 |
| 52w Index | 65.8 % | Qtr Profit Var | 94.9 % | EPS | 213 ₹ | Industry PE | 18.2 |
📊 Financials: MUTHOOTFIN shows strong profitability with ROE at 19.7% and ROCE at 13.4%. EPS is robust at ₹213, supported by quarterly PAT growth (+94.9%, ₹2,656 Cr vs ₹2,345 Cr). However, debt-to-equity is high at 3.69, reflecting leverage risk. Dividend yield of 0.88% provides moderate income support.
💹 Valuation: The stock trades at a P/E of 16.1, slightly below the industry average of 18.2, suggesting fair valuation. PEG ratio of 1.68 indicates reasonable alignment with growth. Book value of ₹859 provides strong intrinsic backing. Overall, valuation appears attractive compared to peers.
🏭 Business Model: MUTHOOTFIN is a leading gold loan NBFC, leveraging its brand strength and wide branch network. Its competitive advantage lies in scale, customer trust, and consistent earnings. However, reliance on gold price cycles and high leverage remain structural risks.
📈 Entry Zone: Attractive entry would be near ₹3,250–₹3,300, aligning with support levels and fair valuation. Current price (₹3,424) is slightly below the 50 DMA (₹3,473) but above the 200 DMA (₹3,274), suggesting consolidation. Long-term investors may accumulate gradually, with focus on sustained earnings growth.
Positive
- Strong EPS of ₹213.
- Quarterly PAT growth (+94.9%).
- ROE (19.7%) and ROCE (13.4%) reflect solid efficiency.
- FII holdings increased (+0.56%), showing foreign investor confidence.
Limitation
- High debt-to-equity ratio (3.69).
- ROCE remains modest compared to peers.
- DII holdings declined (-0.70%), showing reduced domestic support.
Company Negative News
- High leverage remains a structural risk.
- DII holdings declined (-0.70%).
Company Positive News
- Quarterly PAT surged to ₹2,656 Cr (+94.9%).
- FII holdings increased (+0.56%).
- Strong operational growth and brand strength in gold loans.
Industry
- NBFC sector remains competitive and regulated.
- Industry P/E at 18.2 highlights MUTHOOTFIN’s fair valuation.
- Gold price cycles and interest rate environment impact earnings.
Conclusion
⚖️ MUTHOOTFIN demonstrates strong fundamentals with robust EPS, PAT growth, and fair valuation. High debt levels remain a concern, but brand strength and scale provide resilience. Entry is favorable near ₹3,250–₹3,300. Long-term holding is viable, with cautious monitoring of leverage and gold price trends.