Muthoot Finance: Can the stock correction be the reason to buy?

Growth versus margin remains a tough challenge for this primarily gold-loan company and hence more of a good trading bet than a long-term investment case

Madhuchanda Dey
October 03, 2022 / 09:37 AM IST
Muthoot Finance: Can the stock correction be the reason to buy?

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PRO Only Highlights
-  Quarterly performance largely backed by improved realisations
-  Medium-term triggers China plus and protectionist measures for tyre industry
-  Valuations not inexpensive; but improved medium-term outlook

Highlights Teaser loans withdrawn but dent growth as well as margin Q1 FY23 therefore posts a weak show Sequential recovery expected, but restoring good old days of high growth and stellar margin looks extremely difficult Rising rates, a challenge – better off compared to smaller NBFCs but competition from banks remain Subsidiaries still not meaningful to offset the decline in core business Near-term recovery a good trading bet, not convinced about long-term investment case The stock of Muthoot Finance (CMP: Rs 1,040 Market Cap: Rs 41,751...