NEW DELHI: The pandemic year has been a blessing in disguise for India’s largest gold loan company Muthoot Finance. A rapid surge in demand for gold loans has helped the lender cross Rs 10,000 crore in total revenue for 2020-21. Its gold loan portfolio crossed Rs 52,000 crore while net worth breached the Rs 15,000 crore mark all of which are milestones the company has achieved for the first time in its history.
“We have seen good business growth during the last year, especially in the second and the third quarters. After the pandemic, there was a lot of demand for gold loans. Everybody wanted to restart their business and wanted quick funding, which is why the demand for gold loans grew,” its Managing Director George Alexander Muthoot said.
Total loan assets grew 26 per cent year-on-year to Rs 52,622 crore during the stressful year 2020-21 from Rs 41,611 crore a year ago. Total loan disbursements stood at Rs 1.24 lakh crore during the year. For the quarter ended March 31, 2021, the lender reported a net profit of Rs 996 crore compared to Rs 815 crore in the year ago period—a jump of 22 per cent.
Total income rose 18 per cent to Rs 2,828 crore as against Rs 2,403 crore a year ago, while net interest income, or core income, rose nearly 16 per cent to Rs 1,830 crore. The company’s Capital adequacy ratio improved to 27.44 per cent from 25.47 per cent. Its gross NPA, or stage-3 assets, improved to 0.88 per cent as against 2.16 per cent and expected credit losses provision (as a percentage of gross loan assets) stood at 1.19 per cent as of March 2021.
In the current fiscal, company officials say that the first 15 days of April were “okay” in terms of business, but demand took a hit in May as branches were closed. “But, we expect demand to improve by the end of this month as businesses start reopening,” Muthoot added.