Muthoot Finance Limited

Muthoot Finance Limited

In 1939, M. George Muthoot created a partnership firm named Muthoot M. George & Brothers (MMG). MMG was a chit fund based out of Kozhencherry. In 1971, the firm was renamed as Muthoot Bankers, and started to finance loans using gold jewellery as collateral. In 2001, the company was renamed to Muthoot Finance. Muthoot Finance falls under the category of systemically important non-banking financial company (NBFC) of the RBI guidelines. As of March 2023, the promoters hold 73.35% of the equity stake in the company. Muthoot Finance Ltd is the Flagship Company of the group.

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NameIssue SizeMaturityCoupon
Muthoot Finance LimitedCRISIL AA+INE414G07DG091.76Cr20 Mar 202410.00 %
Muthoot Finance LimitedCRISIL AA+INE414G07DY353.62Cr01 Nov 202410.00 %
Muthoot Finance LimitedCRISIL AA+INE414G07EM654.38Cr27 Dec 202410.00 %
Muthoot Finance LimitedCRISIL AA+INE414G07DM8179.47Cr14 Jun 202410.00 %
Muthoot Finance LimitedCRISIL AA+INE414G07DD7110.64Cr20 Mar 20249.75 %
Muthoot Finance LimitedCRISIL AA+INE414G07DV989.82Cr01 Nov 20249.75 %
Muthoot Finance LimitedCRISIL AA+INE414G07EJ281.83Cr27 Dec 20249.75 %
Muthoot Finance LimitedCRISIL AA+INE414G07DJ4105.81Cr14 Jun 20249.75 %
Muthoot Finance LimitedCRISIL AA+INE414G07ET1125.00Cr18 Jun 20259.50 %
Muthoot Finance LimitedCRISIL AA+INE414G07ER5500.00Cr02 Jun 20239.05 %
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History and Promoter

In 1939, M. George Muthoot created a partnership firm named Muthoot M. George & Brothers (MMG). MMG was a chit fund based out of Kozhencherry. In 1971, the firm was renamed as Muthoot Bankers, and started to finance loans using gold jewellery as collateral. In 2001, the company was renamed to Muthoot Finance. Muthoot Finance falls under the category of systemically important non-banking financial company (NBFC) of the RBI guidelines. As of March 2023, the promoters hold 73.35% of the equity stake in the company. Muthoot Finance Ltd is the Flagship Company of the group.

Muthoot Finance Ltd (“MFIN”) is India's largest gold loan NBFC. MFIN is an “Upper Layer NBFC” (NBFC-UL) headquartered in the south Indian state of Kerala. It has been operating since 1939 when M George Muthoot (the father of current Promoters) founded the company. It provides loans secured by gold jewellery, ornaments, etc for personal or business purposes to individuals who cannot access credit or are in urgent need of money. 
On a standalone basis, MFIN has a loan AUM of Rs. 57,731 crs as of December 2022 across 29 states and 4,600+ branches. It has an active customer base of 52.33 lakhs and 81.05 lakhs loan accounts as of December 2022. For the years ended March 31, 2020, 2021 and 2022 its revenues from gold loan business constituted 96.81%, 95.88% and 96.67% respectively of the total income.

Current Management of Muthoot Finance

Particulars Name
Managing DirectorDr Georgie Kurien Muthoot
Deputy Managing DirectorGeorge Muthoot George
Joint Managing DirectorAlexander George Muthoot
Deputy Managing DirectorGeorge Muthoot Jacob
Deputy Managing DirectorGeorge Muthoot Alexander
Chief Financial OfficerOommen K Mammen

Geographical Presence

  • Muthoot Finance is the largest Gold Loan NBFC with a network of 4,739 branches in PAN India across 29 states and union territories.
  • The company is headquartered in Kochi, Kerala. 
  • The company predominantly operates in Southern India. 48% of outstanding gold loans are sourced from South India, 23% from North India, 19% from West India, and 10% from East India.
  • At the global level, Muthoot Finance is in the United States of America, the United Kingdom, and the United Arab Emirates.

Gold Loans offered by Muthoot Finance

Muthoot Finance is the largest gold financing company in India, and its core offering is gold loans. They also offer home loans and personal loans. The gold loans they offer is mentioned below:

Gold LoanLoan Amount (₹)TenureInterest Rate
Muthoot One Percent Loan1,500 to 50,00012 months12% p.a, if 100% of the interest is paid monthly
Muthoot Ultimate Loan1,500 to no limit12 months22% p.a with 2% rebate if 100% interest is paid monthly
Muthoot Delight Loan50,000 to 5 crores12 monthsLow rates of interest
Muthoot Mudra Loan1,500 to 1 lakh12 months11.9% p.a offered at South Indian branches
Muthoot Advantage Loan50,000 to 5 crores12 months18% p.a offered at South Indian branches
Muthoot High Value Plus Loan1,90,000 to 5 crores12 months14% p.a with maximum LTV

Muthoot Finance’s Credit Rating in the past 3 years

Domestic Credit Rating for 3 years by:

Rating AgencyType of InstrumentFinancial Year 2021Financial Year 2022Financial Year 2023
CRISILNon-Convertible Debentures (NCDs)AA+/STABLEAA+/STABLEAA+/STABLE
ICRANon-Convertible Debentures (NCDs)AA+/STABLEAA+/STABLEAA+/STABLE

Muthoot Finance’s Brief financials for the last 3 years (Standalone)

(₹ in Cr)

S.No.ParticularFinancial Year 2021Financial Year 2022Financial Year 2023
1Profit after tax3,7223,9543,473
2Net worth17,41218,34521,022
3AUM54,06359,38464,265
4Total Borrowing45,94649,81149,743
6Gross Non-performing Asset (GNPA)0.88%2.99%3.79%
7Net Non-Performing Asset (NNPA)0.78%2.68%3.40%
8Leverage Ratio (Debt/Equity)2.642.722.36

Board constitution of Muthoot Finance Limited

Muthoot Finance has a strategically sorted governance framework in place, primarily consisting of an Independent Board of Directors and the constitution of the committees of the Board of Directors, as required under applicable laws.

S. NoNameDesignationEducation
1.George Jacob MuthootChairman & Whole Time DirectorDegree in Civil Engineering from Manipal University 
2.George Alexander MuthootManaging DirectorChartered Accountant
3George Thomas MuthootWhole Time DirectorBusinessman
4Alexander George MuthootWhole Time DirectorMBA Graduate from Thunderbird University 
5George Muthoot GeorgeWhole Time DirectorMaster’s degree from the Essec Cornell University in Paris, France 
6George Alexander Muthoot Whole Time DirectorMBA from the University of North Carolina Kenan-Flagler Business School 
7George Muthoot JacobWhole Time DirectorBA.LLB (Hons), from the National University of Advanced Legal Studies, Kochi 
8Abraham ChackoIndependent DirectorPost Graduate Diploma in Business Management from XLRI
9Jacob Benjamin KoshyIndependent DirectorGraduate in Law
10Jose MathewIndependent DirectorChartered Accountant
11Pratip ChaudhuriIndependent Director

Master’s degree in Science and Statistics from University of Rajasthan 

 

12Ravindra PisharodyIndependent DirectorB. Tech from Indian Institute of Technology Kharagpur & PGDM from IIM Calcutta
13Usha SunnyIndependent DirectorQualified Cost Accountant & M.Com from University of Kerala
14Vadakkakara Antony GeorgeIndependent Director

Associate of the Indian Institute of Banking and Finance 

 

“Board Director Diploma with Distinction” from International Institute of Management Development, Lausanne 

 

15Eapen AlexanderExecutive Director

MBA from the Fuqua School of Business at Duke University, USA

 

MSc. in International Political Economy from London School of Economics, UK 

 

16K.R. BijimonExecutive Director

LLB from Mahatma Gandhi University, Kerala 

 

MBA from Cochin University, Kerala 

Advantages of Muthoot Finance Limited

  • Muthoot Finance is the leading gold loan NBFC in India
  • More than 95% of the loan portfolio is secured by gold which is a highly liquid asset
  • The asset quality is comfortable with GNPA at 3.79% and NNPA at 3.40% as of March 2023
  • The company is adequately capitalised with a Capital Adequacy ratio of 31.77% as of March 2023

Disadvantages of Muthoot Finance Limited

Most of the loan portfolio is concentrated in South India (48% as of March 2023)
Moderation of growth in business in the recent past

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