Credit rating agency ICRA has assigned the long to medium term borrowing of Manappuram Finance as ‘A+’ after the Reserve Bank of India relaxed regulatory policy for gold finance companies. The rating agency has also revised the outlook for Manappuram Finance from negative to stable. The rating company is of view that maximum incremental LTV of 75% should keep GFC’s exposure to adverse movements in gold prices manageable.
RBI further underscored that the value of the jewellery for the purpose of determining the maximum permissible loan amount will be only the intrinsic value of the gold content therein and no other cost elements (like making charges) should be added thereto.
Manappuram Finance is a non-deposit taking NBFC and having a strong presence in South India in states of Kerala, Tamil Nadu, Karnataka, Andhra Pradesh and had 2,908 branches across India at the end of FY’12.
