Muthoot vs Manappuram: Analysts decode 2% vs 51% FY27 gain gap; what next?

Gold-financers Muthoot Finance and Manappuram Finance saw a divergence in stock performance primarily due to stock re-rating, says Sunny Agrawal, Head of Fundamental Research at SBI Securities.

Shares of prominent gold loan firms, Muthoot Finance and Manappuram Finance have witnessed a divergent trend thus far in the financial year 2026-27. According to the NSE data, Muthoot Finance stock has gained 2.3 per cent, while Manappuram Finance surged 51 per cent, as of date in FY27.  According to analysts, the stocks saw a sharp divergence in market performance owing to re-rating in valuations.  Sunny Agrawal, Head of Fundamental Research at SBI Securities says the divergence in stock performance for both is primarily due to stock re-rating.  "Muthoot witnessed de-rating from 1-year Price-to-book (PB) ratio of 4.6x in January 2026 to 2.8x (as of date) due to stable gold prices, margins normalisation and threat from new entrants," says Agrawal.  On the other hand, the analyst notes that Manappuram Finance witnessed re-rating from 1.4x (April 2026) to 1.9x (as of date) driven by stable margins (company rationalised asset yields from 21-22 per cent range to 17-18 per cent to bring it in-line with the peers. This weighed down on the stock in FY26), management clarity and improvement in the micro loans business. 

What next for Muthoot, Manappuram Finance?

  Going forward, Agrawal believes that the risk-reward for pure play gold lenders seems unfavourable at current valuations given the rising competition, margins pressure and gold price volatility.  "Upside risk would be better-than-expected execution from gold-lenders against competition and rise in gold prices," the analyst adds. 

Technical outlook on Muthoot, Manappuram Finance

  Muthoot Finance  Current Market Price: ₹3,215 

 

 

  Muthoot Finance stock has rallied nearly 13 per cent in the last four trading sessions, and is now testing the 100-day moving average (100-DMA) hurdle which stands at ₹3,189 after a gap of nearly six months on the daily chart.  Amid the rally, Sudeep Shah, Head of Technical and Derivatives Research at SBI Securities highlights that the stock has given a downward sloping trendline breakout on both the daily and weekly timeframe. The breakout on the daily timeframe is supported by a healthy rise in volumes, adds the analyst.  Emphasising on the comeback of the bulls at the counter, Shah explains that the Relative Strength Index (RSI) has sharply moved higher, indicating build-up go strong bullish momentum. The DI+ (Directional Index) has crossed over DI- in the ADX indicator. Additionally, rising green histogram bars in Moving Average Convergence-Divergence (MACD) further reinforces strengthening bullish bias.  Going ahead, Shah believes that the ₹3,020-3,000 zone, which coincides with the 50-day Exponential Moving Average (EMA), is likely to act as an immediate support and the stock is likely to extend its up move as long it trades above the same.  Manappuram Finance  Current Market Price: ₹365 

 

  Given the over 50 per cent rally in Manappuram Finance, the stock is seen firmly trading above its long-term 200-DMA, which stands at ₹297 on the technical charts.  In the recent past the stock witnessed a strong pullback of nearly 9 per cent since hitting its 50-day EMA on August 19, notes Shah of SBI Securities. Adding that the pullback was well supported by a healthy rise in volume.  Shah believes that the momentum oscillators too are favourably placed for the stock.  "The RSI has moved from 41 to 61 during this period, indicating renewed bullish momentum. The MACD line is on the verge of crossing over the signal line with shrinking red histogram bars, indicating waning bearish pressure," explains the analyst.  Going forward, Shah expects the stock to extend its up move as long as it trades above the 50-day EMA zone of ₹345-340.  Disclaimer: Views and outlook shared on the stock belong to the respective brokerages and are not endorsed by Business Standard. Readers' discretion is advised.