Muthoot Capital Services Limited has informed the Exchange about Transcript
MUTHOOTCAP · price
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Muthoot Capital Services held its Q1 FY26 earnings call, reporting AUM of INR3,239 crores (up ~49% YoY) and balance sheet size of INR3,700+ crores, driven by strong 2-wheeler growth and scaled-up commercial vehicle (INR200 crores) and used car (INR100+ crores) businesses. The company reported a one-off loss of INR4.41 crores, pushing EPS into negative territory, with a sharp jump in impairment costs to INR26.68 crores (vs INR4.86 crores YoY) due to collection stress in northern states (Punjab, Rajasthan, Haryana) caused by attrition. GNPA stood at 5.76% (improved from 9.84% YoY) but NNPA at 2.70%, while the company added new lender partners (Morgan Stanley, Barclays) and saw cost of borrowing drop by 0.60% on XIRR basis. Management guided for credit cost normalization to 1.65-1.75%, GNPA target of 4.5-5% by year-end, and stated an ambition to reach INR10,000 crore AUM by 2028.
Shareholders should note the short-term setback from the Q1 loss and elevated provisioning, but the YoY asset quality improvement, falling borrowing costs, and strong AUM growth signal underlying strength. The North region operational issues have been addressed with new zonal leadership, and management is confident of recovery in Q2, which could be positive for the stock if execution delivers.