· Moody’s upgraded Long Term issuer rating of Muthoot Finance from ‘Ba2’ to ‘Ba1’ with ‘Stable’ Outlook.
Moody’s Ratings in its press release has stated, inter alia, “The upgrade of Muthoot's ratings reflects its strong credit profile, supported by its leading franchise and solid track record in the gold financing industry in India.
Muthoot's strong operational controls and risk management practices in the gold financing portfolio support its growth and asset quality. Despite strong competition and aggressive lending practices by other banks and non-bank financial institutions, the company has maintained its underwriting standards resulting in consistent loan growth and stable asset quality.
Muthoot is most profitable among our rated Indian finance companies, and its profitability is a significant credit strength. Net income to average managed assets was strong at 4.9% in the nine months ended December 2024, supported by a high net interest margin and low credit costs on gold financing. The company's superior profitability supports internal capitalization, reflected in its tangible common equity to total managed assets (TCE/TMA) of around 23.3% at the end of December 2024.”
George Alexander Muthoot, Managing Director, on this occasion, stated “We are pleased to announce that Moody's Ratings has upgraded our long-term corporate family rating to Ba1 from Ba2. This upgrade signifies Moody's confidence in our robust financial performance, strong asset quality, and resilient business model of The Muthoot Group. The Ba1 rating reflects Muthoot Finance's consistent profitability, prudent risk management practices, and diversified funding profile. Our strong operational resilience, demonstrated by our ability to navigate challenging market conditions, has also been recognized by Moody's Ratings. This credit rating upgrade is a testament to the dedication of our employees, the trust of our customers, and the support of our stakeholders. We remain committed to delivering sustainable growth, enhancing stakeholder value, and maintaining our position as a leader in the financial services industry.
We express our sincere gratitude to all our stakeholders for their unwavering support and belief in Muthoot Finance. We will continue to strive for excellence and uphold the highest standards of corporate governance and ethics.”
In addition, Muthoot Finance has also received an upgrade from S&P Global Ratings to ‘BB+’ with a ‘Stable’ outlook, further reinforcing its strong financial position and commitment to excellence in the financial services sector.