InvestorQ : Why is Muthoot Finance looking to raise a big sum of Rs.5,000 crore from the bond markets?
Dilmini Mercia made post

Why is Muthoot Finance looking to raise a big sum of Rs.5,000 crore from the bond markets?

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Dawn Cherian answered.
2 weeks ago
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India’s largest gold loan company, Muthoot Finance, will be raising a total of Rs.5,000 crore via bonds in multiple tranches. COVID 2.0 may have resulted in pressure on output but gold loans have suddenly become attractive all over again. As banks get wary of personal loans, people are rushing to monetize their gold and raise loans. After all, gold best bridges the short term liquidity gaps in people’s budgets and the process is also quite simple.

For the Mar-21 quarter, Muthoot reported 22% growth in net profits at Rs996cr driven by a 16% spurt in Net interest income to Rs.1,830 crore. However, the growth in loan assets at 26% yoy to Rs.52,622 crore as of Mar-21 has been virtually relentless. Muthoot will use these funds of Rs.5,000 crore to expand its loan book in current conditions and as a war chest to expand its loan book aggressively in the coming year.

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