Manappuram profit jumps 223% as gold loans surge

MANAPPURAM Manappuram Finance Limited (MANAPPURAM) reported a 222.9% year on year increase in Q2 FY27 consolidated net profit to ₹701 crore. Revenue from operations grew 46.2% to ₹3,356 crore. The biggest driver was its gold loan business. Gold loan AUM increased 92.5% to ₹60,640 crore. Total consolidated AUM reached ₹73,303 crore, up 60.1%. Gold loans now account for roughly 83% of total AUM. There is another positive development. Asirvad Micro Finance, its microfinance subsidiary, returned to profit with ₹32 crore in Q2, compared with a loss of ₹168 crore a year ago. But the concentration in gold lending deserves attention. Gold loan growth is supported by higher gold prices and increased lending activity. The company reported gold tonnage growth of 22% year on year. However, a large gold loan portfolio also makes the business sensitive to gold price movements, collateral values and borrower repayment behaviour. My view: The earnings recovery is strong, and the improvement in Asirvad is encouraging. But I would not extrapolate 223% profit growth into future quarters. I would watch gold loan asset quality, loan to value ratios and whether the microfinance recovery continues. My stance: Positive on the current operating momentum, but the high concentration in gold loans remains a risk worth monitoring. Disclosure: I do not hold this stock.