⚠ Disclaimer: This report is generated using AI tools and is for informational purposes only. It does not constitute investment advice. Please consult a registered financial advisor before making any investment decisions.
MUTHOOTFIN - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 3.8
| Stock Code | MUTHOOTFIN | Market Cap | 1,40,301 Cr. | Current Price | 3,493 ₹ | High / Low | 4,150 ₹ |
| Stock P/E | 19.3 | Book Value | 793 ₹ | Dividend Yield | 0.74 % | ROCE | 13.4 % |
| ROE | 19.7 % | Face Value | 10.0 ₹ | DMA 50 | 3,755 ₹ | DMA 200 | 3,133 ₹ |
| Chg in FII Hold | 0.17 % | Chg in DII Hold | -0.24 % | PAT Qtr | 2,345 Cr. | PAT Prev Qtr | 2,046 Cr. |
| RSI | 33.9 | MACD | 1.51 | Volume | 14,50,056 | Avg Vol 1Wk | 8,69,779 |
| Low price | 1,964 ₹ | High price | 4,150 ₹ | PEG Ratio | 2.02 | Debt to equity | 3.52 |
| 52w Index | 70.0 % | Qtr Profit Var | 87.4 % | EPS | 181 ₹ | Industry PE | 18.9 |
📊 Core Financials
- Revenue & Profitability: Quarterly PAT rose from 2,046 Cr. to 2,345 Cr. (+87.4%), showing strong earnings momentum. EPS at 181 ₹ reflects solid profitability.
- Margins: ROE at 19.7% and ROCE at 13.4% are decent, though not industry-leading.
- Debt: Debt-to-equity ratio of 3.52 is high, reflecting reliance on borrowings typical of NBFCs.
- Cash Flow: Dividend yield of 0.74% is modest, suggesting reinvestment focus rather than strong shareholder payouts.
💹 Valuation Indicators
- P/E Ratio: 19.3 vs Industry PE of 18.9 → Fairly valued, slightly above peers.
- P/B Ratio: Current Price (3,493 ₹) / Book Value (793 ₹) ≈ 4.4 → Premium valuation.
- PEG Ratio: 2.02 → Indicates moderate overvaluation relative to growth.
- Intrinsic Value: Current price is slightly above fair value zone, limiting near-term upside.
🏭 Business Model & Competitive Advantage
- Muthoot Finance is India’s largest gold loan NBFC, leveraging strong brand trust and extensive branch network.
- Business model is resilient, backed by collateralized lending (gold loans), reducing credit risk.
- High debt levels are structural to the NBFC model but supported by strong asset quality.
📈 Entry Zone & Long-Term Guidance
- Entry Zone: Attractive accumulation range between 3,000 ₹ – 3,200 ₹, closer to DMA 200 support levels.
- Long-Term Holding: Suitable for investors seeking exposure to gold-backed lending. Strong fundamentals, but high leverage and cyclical risks warrant staggered buying.
✅ Positive
- Strong quarterly PAT growth (+87.4%).
- EPS of 181 ₹ highlights robust earnings capacity.
- ROE of 19.7% reflects decent efficiency.
- FII holding increased by 0.17%, showing foreign investor confidence.
⚠️ Limitation
- High debt-to-equity ratio (3.52) increases financial risk.
- P/B ratio of 4.4 indicates premium valuation.
- Dividend yield of 0.74% is modest, limiting passive income appeal.
📉 Company Negative News
- DII holding decreased by 0.24%, showing reduced domestic institutional support.
- High leverage remains a structural concern for NBFCs.
📈 Company Positive News
- Quarterly PAT rose significantly from 2,046 Cr. to 2,345 Cr.
- FII inflows (+0.17%) highlight foreign investor interest.
- Strong brand positioning in gold loan segment supports growth.
🌐 Industry
- NBFC sector is cyclical, influenced by interest rates and gold price movements.
- Industry PE at 18.9 suggests Muthoot is trading at a slight premium.
🔎 Conclusion
Muthoot Finance demonstrates strong fundamentals with robust earnings growth and a dominant position in gold-backed lending. However, high leverage and premium valuations limit near-term upside. Investors may consider entering around 3,000–3,200 ₹ for long-term holding, while avoiding aggressive buying at current levels. The company remains fundamentally healthy and strategically well-placed in the NBFC sector.
I can also outline technical support and resistance zones using RSI, MACD, and DMA data to complement this fundamental analysis if you'd like.