Check Before You Invest : Muthoot Finance Ltd

Q: Which industry/sub-sector does Muthoot Finance Ltd belong to?

Muthoot Finance Ltd belongs to the BFSI sector, operating specifically within the Finance - NBFC segment.

Q: Is Muthoot Finance Ltd a good quality company?

Muthoot Finance Ltd is a good quality company, based on a consistently good multi-year financial track record. This assessment is based on the bank’s performance on Total Income growth, Pre-Provision Operating Profit, RoA, RoE, CAR, and Asset Quality, along with how these metrics compare with its long-term averages.

Q: Is Muthoot Finance Ltd undervalued or overvalued?

Muthoot Finance Ltd appears Somewhat overvalued, as its key valuation ratios are higher than their past averages. Based on the industry it operates in, the relevant valuation ratios include one of the following, P/E, P/BV, P/Sales, EV/EBITDA or a combination of two or more. Valuation Ratios. Price to Earnings, Current: 12.96, Historic Median: 15.51. Price to Book, Current: 3.48, Historic Median: 3.03. Price to Sales, Current: 4.81, Historic Median: 5.37. EV to EBITDA, Current: 9.37, Historic Median: 10.67

Q: Is Muthoot Finance Ltd a good buy now?

Muthoot Finance Ltd is a neutral opportunity now, based on stable price trend analysis suggesting prices may move sideways. However, you need to check its quality and valuation before making a decision

Q: Total Income growth of Muthoot Finance Ltd?

Muthoot Finance Ltd Operating Income growth is 35.33% for FY-2025, which is above its 5-year CAGR of 14.43%, indicating faster growth.

Q: Return on Assets of Muthoot Finance Ltd?

Muthoot Finance Ltd Return on Asset is 5%, which is in line with its 5-year historical median of 5.1%, indicating stable earnings on assets. Efficiency & Key Metrics. NPM (%), Current: 30.42, Historic Median: 33.03. PPOP (%), Current: 38.23, Historic Median: 19.13. RoA (%), Current: 5, Historic Median: 5.1

Q: Return on Equity (ROE) of Muthoot Finance Ltd?

Muthoot Finance Ltd Return on Equity is 19.7% for FY-2025, which is in line with its 5-year historical median of 19.7%, indicating the business is making similar use of its shareholders capital.

Q: Pre-provisioning operating profit margin of Muthoot Finance Ltd?

Muthoot Finance Ltd Pre-provisioning operating profit margin, which is the bank’s core operating profit before provisioning for bad loans, is 38.23% for FY-2025, which is above its 5-year median(19.13%), indicating increasing margins.

Q: Net Profit Margin of Muthoot Finance Ltd?

Muthoot Finance Ltd Net Profit Margin, which is the difference between the rate of interest earned on assets and the rate of interest paid on liabilities, is 30.42% for FY-2025, which is below its 5-year median( 33.03%), indicating decreasing margins.

Q: Does its ROIC exceed its WACC?

Muthoot Finance Ltd return on invested capital (ROIC) is 9.66% for FY-2025, is lower than its estimated weighted average cost of capital (WACC) of 11.25%, indicating value erosion.

Check Before You Invest : Muthoot Finance Ltd

BSE: 533398 NSE: MUTHOOTFIN ISIN: INE414G01012

| Sector: BFSI | Industry: Finance - NBFC

Snapshot

Q.1 Which industry/sub-sector does Muthoot Finance Ltd belong to?

Muthoot Finance Ltd belongs to the BFSI sector, operating specifically within the Finance - NBFC segment.

Q.2 Is Muthoot Finance Ltd a good quality company?

Muthoot Finance Ltd is a good quality company, based on a consistently good multi-year financial track record.

This assessment is based on the bank’s performance on Total Income growth, Pre-Provision Operating Profit, RoA, RoE, CAR, and Asset Quality, along with how these metrics compare with its long-term averages.

Q.3 Is Muthoot Finance Ltd undervalued or overvalued?

Muthoot Finance Ltd appears Somewhat overvalued, as its key valuation ratios are higher than their past averages.

Based on the industry it operates in, the relevant valuation ratios include one of the following, P/E, P/BV, P/Sales, EV/EBITDA or a combination of two or more.

Valuation Ratios	Current	5-year Historic Median
Price to Earnings	12.96	15.51
Price to Book	3.48	3.03
Price to Sales	4.81	5.37
EV to EBITDA	9.37	10.67

Q.4 Is Muthoot Finance Ltd a good buy now?

Muthoot Finance Ltd is a neutral opportunity now, based on stable price trend analysis suggesting prices may move sideways. However, you need to check its quality and valuation before making a decision

Performance Analysis

We have analysed the performance of the company on the following:

How has it performed on generating Profits?
By checking its Total Income growth, NPM, PPOP, RoA and RoE compared to its last 5-year median.
How efficiently has it grown and managed operations?
By checking its Total Asset growth.
How strong is its Capital position and Asset Quality?
By checking its Capital Adequacy Ratio (CAR), GNPA and NNPA.

A: What are the trends in income and profitability?

Q.1 Total Income growth of Muthoot Finance Ltd?

Muthoot Finance Ltd Operating Income growth is 35.33% for FY-2025, which is above its 5-year CAGR of 14.43%, indicating faster growth.

Q.2 Return on Assets of Muthoot Finance Ltd?

Muthoot Finance Ltd Return on Asset is 5%, which is in line with its 5-year historical median of 5.1%, indicating stable earnings on assets.

	Current Level	5-year Historic Median
NPM (%)	30.42	33.03
PPOP (%)	38.23	19.13
RoA (%)	5	5.1

Q.3 Return on Equity (ROE) of Muthoot Finance Ltd?

Muthoot Finance Ltd Return on Equity is 19.7% for FY-2025, which is in line with its 5-year historical median of 19.7%, indicating the business is making similar use of its shareholders capital.

Q.4 Pre-provisioning operating profit margin of Muthoot Finance Ltd?

Muthoot Finance Ltd Pre-provisioning operating profit margin, which is the bank’s core operating profit before provisioning for bad loans, is 38.23% for FY-2025, which is above its 5-year median(19.13%), indicating increasing margins.

Q.5 Net Profit Margin of Muthoot Finance Ltd?

Muthoot Finance Ltd Net Profit Margin, which is the difference between the rate of interest earned on assets and the rate of interest paid on liabilities, is 30.42% for FY-2025, which is below its 5-year median( 33.03%), indicating decreasing margins.

Q.6 Does its ROIC exceed its WACC?

Muthoot Finance Ltd return on invested capital (ROIC) is 9.66% for FY-2025, is lower than its estimated weighted average cost of capital (WACC) of 11.25%, indicating value erosion.

B: Does the bank grow efficiently and manage its operating costs?

Q.7 Total Asset growth of Muthoot Finance Ltd?

Muthoot Finance Ltd Total Asset growth is 42.58% for FY-2025, which is above its 5-year CAGR of 19.15%, indicating faster growth.

C: How strong is the bank’s capital position and asset quality?

Q.8 Capital Adequacy ratio of Muthoot Finance Ltd?

Muthoot Finance Ltd Capital Adequacy ratio (CAR) is 23.71% for FY-2025, which is above the regulatory requirement of 15%, indicating strong capital position.

Ownership & governance

D: Promoter shareholding and pledge status of Muthoot Finance Ltd?

Q.1 Promoter shareholding and pledge status of Muthoot Finance Ltd?

Promoters hold 73.35% of the Muthoot Finance Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

E: How does Muthoot Finance Ltd performance compare with that of its Peers?

Q.1 AUM Growth of Muthoot Finance Ltd vs Industry Peers?

Muthoot Finance Ltd AUM CAGR is 19.15%, compared to the 5-year industry median CAGR of 23.24%, indicating slower growth and losing its market share.

Q.2 Profit metrics (NPM, PPOP, RoA) of Muthoot Finance Ltd vs industry peers

Muthoot Finance Ltd profit metrics are above the industry median level of 17.64%, indicating stronger profitability compared to peers.

Profit Metrics

	Current Level	5-year Industry Median
NPM (%)	30.42	24.08
PPOP (%)	38.23	25.73
RoA (%)	5	3.1

Q.3 Operating efficiency of Muthoot Finance Ltd vs industry peers?

Muthoot Finance Ltd ROCE (13.5) is above the industry median of (10.9); while the current ROE (19.7) are above than the 5-year average Industry ROE (15.6). This shows that the business is positioned in the top quartile of the industry.

Operating Efficiency

	Current Level	5-year Industry Median
NPM (%)	30.42	24.08
PPOP (%)	38.23	25.73
RoA (%)	5	3.1
ROCE (%)	13.5	10.9
ROE (%)	19.7	15.6

Valuation & price assessment

Q.1 Stock return of Muthoot Finance Ltd over the last decade?

Over the last 9 years, the stock has delivered a CAGR of 31.5% based on the current price.

	9Y	5Y	3Y	1Y
Share Price CAGR	31.5%	21.1%	43.2%	57.5%

Q.2 How do the current valuation ratios compare with 5-year historical median and industry numbers?

Valuation Ratios	Current	5-year Historic Median	5-year Industry Median
Price to Earnings	12.96	15.51	29.12
Price to Book	3.48	3.03	1.11
Price to Sales	4.81	5.37	9.10
EV to EBITDA	9.37	10.67	11.77

Q.3 Valuation ratios of Muthoot Finance Ltd vs historical and industry averages?

The current Price-to-Book (P/B) ratio of 3.48 is higher than its historical median of 3.03, indicating that the stock is trading above its historical average valuation.

Check more companies

1. Bajaj Finance

2. Shriram Finance

3. JIO Financial Serv.

4. Muthoot Finance

5. Tata Capital

6. Chola Invest & Fin.

7. Bajaj Hold & Invest

Check trending companies

1. Granules India Ltd.

2. Nestle India Ltd.

3. National Aluminium Company Ltd.

4. Muthoot Finance Ltd.

5. Motilal Oswal Financial Services Ltd.

Check Before You Invest : Muthoot Finance Ltd

Snapshot

Performance Analysis

Ownership & governance

Peer comparison (industry-wise, mcap)

Profit Metrics

Operating Efficiency

Valuation & price assessment

Check more companies

Check trending companies

About MoneyWorks4Me

Our Vision

What Makes MoneyWorks4Me Different

Our Approach: Ensuring compounding work its magic on client portfolio.

Name of the IA registered with SEBI:	The Alchemists Ark Pvt. Ltd.
Logo:
Trade/Brand Name of IA:	MoneyWorks4Me Investment Advisers
Brand Logo:
SEBI Registration Number:	INA000013323 Validity – May 16, 2019 – Perpetual
Registration:	Non-Individual
BSE Enlistment No:	1187
Address:	B-101, Signet Corner Building, Balewadi Phata, Baner, Pune, Maharashtra 411045
Compliance officer Details:	Name: Shrikant Jagtap Email: shrikant.jagtap@moneyworks4me.com Telephone: +919860359463 Address: Same as IA
Grievance Officer Details:	Name: Mukta Vaze Email: mukta.vaze@moneyworks4me.com Telephone: +91 98609 19463 Address: Same as IA
Principal Officer Details:	Name: Atharva Bhide Email: atharva.bhide@moneyworks4me.com Telephone: +91 91758 99463 Address: Same as IA
Standard Warning:	Investment in securities market are subject to market risks. Read all the related documents carefully before investing.
Disclaimer:	Registration granted by SEBI, enlistment with exchange and certification from NISM in no way guarantee performance of the intermediary or provide any assurance of returns to investors.