Muthoot Finance Shares up 25% in Eight Sessions — Buy, Hold or Sell? All You Need to Know
Shares of Muthoot Finance soared over 1% today, clocking gains for the eight consecutive sessions on the back of strong buying momentum.
Muthoot Finance Shares up 25% in Eight Sessions — Buy, Hold or Sell? All You Need to Know
Shares of Muthoot Finance soared over 1% today, clocking gains for the eight consecutive sessions on the back of strong buying momentum. Muthoot Finance shares soared 1.20% to a record high of ₹2,570.65 apiece on the BSE. In the past eight sessions, the stock has surged by 24.6%, crossing the market capitalisation past ₹1 lakh crore-mark.
The rally in gold NBFC stocks can be attributed to the Reserve Bank of India’s measure on easing the rules for small-ticket gold loans.
On Friday, RBI relaxed the Loan-to-Value (LTV) norms on gold loans. Under the revised guidelines, gold loans below ₹2.5 lakh will attract a LTV ratio limit of 85% from the earlier 75%. Loans above ₹5 lakh will continue to have a 75% LTV cap, including interest.
LTV determines the percent of value a borrower can receive for their gold.
As per analysts, the revised guidelines provide much-needed flexibility to gold financiers.
“The RBI is enforcing stricter renewal rules—borrowers must repay interest and meet credit checks before renewal or top-up. Lenders now need to clearly disclose all charges, including gold assaying and auction fees, in loan documents. This is a significant step toward greater prudence, transparency, and borrower protection, benefiting all NBFCs, particularly gold loan providers,” said Avinash Singh, Senior Research Analyst at Emkay Global Financial Services Ltd.
The company had a consolidated loan AUM (asset under management) of ₹1.22 lakh crore in FY25.
Outlook on stock
Anshul Jain, Head of Research at Lakshmishree Investments noted that Muthoot Finance shares broke a bullish 17-week-long flat base at ₹2,300 with strong price action, buoyed by institutional-grade accumulative volumes.
“The structure indicates strength, and Muthoot Finance stock price is now poised to move towards Fibonacci extension targets of ₹2,690 and ₹2,850. The breakout zone will now act as strong support, and as long as price holds above ₹2,300, dips can be considered as buying opportunities for positional traders,” said Jain.
Muthoot Finance shares jumped 15% in one month, while giving staggering returns of 130% in two years and 165% in five years.
