Manappuram Finance sparkles as focus shifts to non-gold loans

With domestic gold prices hovering near record highs, shares of Manappuram Finance Ltd and Muthoot Finance Ltd, two major non-banking gold financiers, have been shining. But one of them has sharply outperformed the other. Over the last six months, Manappuram Finance Ltd's shares have gained over 40%, while its larger peer Muthoot Finance Ltd has seen only a 27% rise.

- Harsha Jethmalani

Manappuram's focus on diversifying towards the non-gold loan segment is a positive move. In the September quarter (Q2FY24), the company saw growth in assets under management (AUM) driven primarily by the non-gold segment. This was largely due to the growth in microfinance lending, which led to non-gold AUM accounting for approximately 47% of the overall AUM mix in Q2, compared with 37% in Q2FY23. Manappuram has guided for a 50:50 mix between gold and non-gold segments in its portfolio.