MUTHOOTFIN Q2 FY27 Results Analysis: Income Jumps 37%, Provisions Surge 909% QoQ

Cofacto Research Published October 31, 2026 4 min read
Neutral

MUTHOOTFIN's Q2 FY27 numbers came in mixed, with revenue of Rs. 8,841.92 Cr (+37.30% YoY) and PAT growth of +26.90% YoY. Here's a quick read of what worked, what to watch, and what management said.

Quick Details
Results dateOctober 31, 2026
Revenue (Q2)Rs. 8,841.92 Cr (+37.30% YoY)
PAT (Q2)Rs. 2,976.63 Cr (+26.90% YoY)
EPS (Q2)Rs. 74.14 (+26.90% YoY)

Quarter Snapshot

Muthoot Finance delivered 37.3% YoY standalone income growth and 41.2% PPOP growth, with consolidated loan assets of Rs.2,10,480.16 cr already at the FY27 guided AUM level in H1. The offset is a provisioning spike (Rs.514.92 cr, +909% QoQ) that pushed Stage III to 3.87%, above management's 2-3% band, while provision coverage fell to 11.80%. Growth guidance is effectively delivered, but the forward question is whether credit costs stabilize to let PAT keep tracking PPOP.

Q2 FY27 Expectations vs Results

DriverWhat happenedVerdict
Revenue/demand ahead — gold-price tailwind, accelerating NBFC gold flowsConsol total income +37.2% YoY; loans +17.7% H1Played out
Margins compressing — no funding-cost relief; yield vs 18–18.5% band the swingFinance costs +45.5% YoY vs interest income +38.5%; net margin 33.66% vs 36.41% a year agoPlayed out
Asset quality supportive — credit costs to decline/stabilize; Belstar tailwindProvisions Rs.514.92 cr (+443.3% YoY, +909.1% QoQ); Stage III 3.87%; PCR 11.80%Contradicted
Collateral/LTV headroom improving through the quarterLTV not disclosed in the filingNot observable
Muthoot Money approvals pendingFiling notes: still pending NCLT/RBI as of Oct 31, 2026 — still openPlayed out
Guidance revision at this callNot addressed in the filing — call itemNot observable
RBI compliance penalty (Rs.5.80 lakh, Jul 17, 2026, per pre-call note, web-sourced)Not in the filing's disclosures; immaterial if incurredNot observable

Read our full results preview.

Management Guidance vs Delivery

What management saidWhereWhat happenedVerdict
FY27 consolidated AUM +15% from Mar-26 base (~Rs.2,10,000 cr or higher)Q4 FY26 & Q1 FY27 earnings callsConsolidated loan assets Rs.2,10,480.16 cr at Sep-30, +17.7% in H1 (balance-sheet loans, net of ECL/EIR — a close proxy for AUM) — already at the guided FY levelOn Track
FY27 standalone AUM +15%Q4 FY26 & Q1 FY27 earnings callsStandalone loans Rs.1,89,965.70 cr at Sep-30, +17.6% in H1On Track
Promised AUM-guidance revision after half-yearly resultsQ1 FY27 earnings call ("we can give a revised guidance if it is needed")Not addressed in the stock-exchange filing — call itemToo Early
"Loan growth is the primary factor… profits will follow"management commentary, prior-quarter callsLoans +17.7% H1; PAT +26.9% standalone / +34.1% consol YoY — profits indeed followed, even with credit costs upConfirmed
Stage III expected at ~2–3% of loansmanagement commentary in prior-quarter callsQ2 FY27 Stage III 3.87% — above the stated bandContradicted
No reduction in borrowing costs expectedCFO, Q1 FY27 callFinance costs +45.5% YoY vs interest income +38.5%; borrowing-cost proxy ~7.41% annualizedConfirmed

Key Numbers, Quarter by Quarter

MetricQ2 FY26Q1 FY27Q2 FY27
Stage III (gross)2.252.283.87
Net Stage III1.861.993.41
PCR17.1913.0111.80
CAR20.8920.3019.81

Key Investment Insights

Key Positives

  • Standalone total income grew 37.3% YoY to Rs.8,841.92 cr, with interest income up 38.5% YoY to Rs.8,729.67 cr
  • Standalone PPOP grew 41.2% YoY to Rs.4,402.76 cr; consolidated PPOP grew 46.3% YoY to Rs.4,850.41 cr
  • Standalone PAT grew 26.9% YoY to Rs.2,976.63 cr; consolidated PAT attributable to owners grew 34.1% YoY to Rs.3,246.53 cr
  • Consolidated loan assets reached Rs.2,10,480.16 cr at Sep-30, +17.7% in H1, already at the FY27 guided AUM level of ~Rs.2,10,000 cr
  • Subsidiaries contributed Rs.269.90 cr (8.3% of consolidated owners' PAT), positive vs a negative NCI of Rs.(8.98) cr in Q2 FY26
  • Employee expenses grew 16.0% YoY and other expenses fell 10.4% QoQ, well below income growth

Risk Factors

  • Stage III ratio rose to 3.87% of gross loans from 2.28% in Q1 FY27, above management's stated 2-3% band
  • Standalone impairment on financial instruments spiked to Rs.514.92 cr, up 443.3% YoY and 909.1% QoQ
  • Provision coverage ratio fell to 11.80% from 17.19% a year ago
  • Finance costs grew 45.5% YoY, outpacing interest income growth of 38.5%
  • CAR slipped to 19.81% from 20.89% a year ago; Reg-52 debt-equity rose to 3.90 from 3.52
  • Muthoot Money amalgamation remains subject to NCLT Kochi and RBI approvals, flagged as an Emphasis of Matter
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Disclaimer: This results analysis is published for educational and informational purposes only. It is not investment advice, not a recommendation to buy, sell or hold any security.

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