Manappuram, Muthoot Finance: Growth concerns weigh on near-term outlook

Analysts have cut earnings growth forecast but see the stocks giving up to 34.4 per cent (Muthoot) and 58.7 per cent (Manappuram) returns on attractive valuation

The October-December quarter of fiscal year 2021-22 (Q3FY22) showed weak quarterly results by Manappuram Finance and Muthoot Finance. As a result, the shares of the two gold financiers have cracked 17.6 per cent and 5.7 per cent, respectively, since the announcement of their earnings on February 14 and February 12. The benchmark indices, meanwhile, have slipped about 0.3 per cent during the period.

Analysts say Q3FY22 was a disappointing quarter for both gold financiers as competitive pressure on yields and tepid growth in asset under management (AUM) weighed on respective companies’ financials.

Muthoot Finance reported a 1 per cent decline