Q1 2027 Muthoot Microfin Ltd Earnings Call Transcript
Key Points
- Record Q1 disbursements of INR2,644 crores, up 49% year-over-year, with strong growth momentum.
- Asset quality improving rapidly with 97.97% on-time collection efficiency and 99.9% for fresh loans.
- Strategic diversification into non-JLG products (individual loans, gold loans) is performing well with minimal delinquency.
- Cost of funds reduced to 10.14% with incremental borrowing at 9.8%, expected to reach single digits due to rating upgrade.
- Revised growth guidance upward to 20% AUM growth, supported by strong liquidity and product expansion.
- Active customer base saw a slight quarter-over-quarter decline of 0.6% due to deliberate pruning of lower-quality customers.
- Branch network declined year-over-year, though expansion is planned in newer geographies.
- Yield on portfolio remains flat due to historical NPA portfolio, limiting immediate NIM expansion.
- Credit cost guidance revised lower but still elevated at 2.6%, reflecting ongoing asset quality challenges.
- Gold loan business is still in early stages with minimal co-lending, relying heavily on referral model.
Ladies and gentlemen, good day and welcome to the Muthoot Microfinance Q1 FY27 earnings conference call. (Operator Instructions) Please note this conference is being recorded.
I now hand the conference over to Mr. Arun Nalkara from JM Financial. Thank you and over to you, sir.
Thank you. Good morning, everyone, and welcome to the Q1 FY27 earnings conference call for Muthoot Microfin Limited.
First of all, I would like to thank the management of Muthoot Microfin for giving us this opportunity to host this call.
From the management side, we have Mr. Thomas Muthoot, Chairman; Mr. Sadaf Sayeed, Chief Executive Officer; Mr. Praveen T., Chief Financial Officer; Mr. Udeesh Ullas, Chief Operating Officer; and Mr. Rajit Gupta, AVP, Investor Relations.
I would now like to hand over the call to Mr. Sadaf Sayeed for his opening remarks, post which we can open the floor for Q&A. Thank you and over to you, sir.
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