Manappuram Finance Q2 PAT more than triples as gold loans power earnings recovery

Manappuram Finance is increasingly centred on its gold-backed lending franchise, which accounted for Rs 60,640 crore of consolidated assets under management at the end of the September quarter. The non-Banking finance company reported consolidated profit after Tax (PAT) of Rs 701.25 crore for the quarter ended September 30, 2026, more than tripling from Rs 211.31 crore a year earlier.

Consolidated total income rose 47.8 per cent YoY to Rs 3,362.03 crore, while profit before tax increased to Rs 937.59 crore from Rs 302 crore. Revenue from operations stood at Rs 3,351.55 crore, led by interest income of Rs 3,339.06 crore, compared with Rs 2,229.26 crore in the corresponding quarter last year.

The earnings recovery was driven by the gold loan and other businesses, where quarterly revenue rose to Rs 3,032.62 crore from Rs 1,981.36 crore. Segment profit before tax climbed to Rs 894.59 crore from Rs 516.82 crore. The microfinance business also returned to profitability, reporting profit before tax of Rs 43 crore against a loss before tax of Rs 214.82 crore a year earlier.

Finance costs rose to Rs 1,380.32 crore from Rs 875.53 crore as the lending book expanded. However, impairment on financial instruments declined to Rs 294.15 crore from Rs 381.43 crore, supporting profitability. For the first half of FY27, consolidated profit before tax rose to Rs 1,719.41 crore from Rs 403.54 crore, while PAT reached Rs 1,746.02 crore.

The board approved the unaudited results on November 12, 2026, and declared a second interim Dividend of Rs 1 per equity share of face value Rs 2 each. The record date is November 18, 2026. Investors will also note that Asirvad Micro Finance had not complied with certain covenants linked to portfolio quality and return on equity as of September 30, 2026, although the group maintained full asset cover for its secured listed non-convertible debentures.

As of 3:52 pm on November 12, 2026, Manappuram Finance shares were trading at Rs 320.25, down 0.23 per cent from the previous close. The stock was about 13.9 per cent below its 52-week high of Rs 371.90. Over one year, the shares have gained 16.07 per cent, compared with a 0.08 per cent decline in the BSE 500 over the same period. The company’s market capitalisation stood at about Rs 30,153 crore.

What This Means for Investors

The quarter strengthens evidence that Manappuram’s gold-loan franchise is delivering both growth and improved earnings traction. Gold lending generated almost all of the group’s quarterly segment profit before tax, while the move of microfinance into profit marks a significant improvement from last year’s losses. Lower impairment charges also helped earnings, though rising finance costs remain relevant as the group continues to fund balance-sheet growth.

For investors, the result is supportive because it combines stronger core lending income with a turnaround in the group’s most volatile segment. The key test is whether Asirvad can sustain its recovery while reducing legacy portfolio stress and meeting its financing covenants. Vehicle finance remains in a collection-led repair phase, leaving gold loans as the principal source of earnings visibility. At around 20.8 times trailing 12-month earnings and 1.87 times book value, the valuation places importance on durable profitability, funding discipline and controlled credit costs.

Disclaimer: The article is for informational purposes only and not investment advice.