Muthoot Finance, the country's largest gold financing company in terms of loan portfolio, has obtained credit ratings from three global agencies as it prepares to access the debt market.
The company has been assigned long-term rating of BB plus with a stable outlook by Fitch Ratings, BB with stable outlook by S & P Global Ratings and Ba2 with stable outlook by Moody's Investor Service.
"The ratings take into account Muthoot Finance's well-established franchise in the niche segment of gold-backed financing, its low credit losses and satisfactory leverage," said Fitch Ratings.
S & P Global Ratings said the ratings on Muthoot Finance are driven by the company's very strong capital and earnings with the risk-adjusted capital ratio at above 45 per cent. "It also has a strong market position in loans against gold although it is relatively small in the overall financial sector in India."
Moody's Investor Service said the rating takes into account the company's leading franchise and well-established track record in lending against the gold jewellery segment in India besides strong solvency metrics, including asset quality, capital and profitability.
"This is another achievement by Muthoot Finance and it is a recognition of its leading, long track record in gold loan business," said Managing Director George Alexander Muthoot.
"With these ratings, we are expecting to access international debt markets which will enable us to further expand our business," he said in a statement.
Muthoot Finance has over 5,000 branches spread across 23 states and six union territories. Its gold loan portfolio totals about Rs 35,000 crore.
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