Any current/future new fundraising through debt or equity?

Muthoot Microfin has raised INR 1,450 crores during the quarter through Pass Through Certificates (PTC), reducing the cost of funds by 23 bps. They have recently completed a large PTC transaction of around INR 500 crores with State Bank of India. The company is actively utilizing multiple funding sources including PTC deals with private sector banks like HSBC and DBS. There is active interest from Development Financial Institutions (DFIs) and foreign banks, especially through the External Commercial Borrowing (ECB) route. Liquidity is strong with over INR 2,000 crores available through pre-fun

Any current/future capex/capital investment/strategic investment?

Currently, Muthoot Microfin Limited is focusing on calibrated branch expansion, having opened 27 new branches while closing 1, reaching a total of 1,726 branches. The company plans to rationalize branches with low profitability or high operating cost, especially in UP and Bihar, while deepening presence in newer territories like Assam, Telangana, and Andhra Pradesh. No large-scale CAPEX is planned for new branch infrastructure; instead, they are leveraging existing branches to roll out new products such as Loan Against Property (Micro LAP), gold loans, and individual MSME loans. A strategic co

Future growth expectations in sales/revenue/volumes?

Q4 disbursement was only 9.4% higher than Q1, despite Q1 being a slower quarter for lending entities. July 2025 saw a 15%-18% increase in business, with further improvement expected in August and beyond. Disbursements increased from around INR 630 crores in Q4 FY25 to INR 727 crores in July, with a target of INR 800-850 crores soon and close to INR 1,000 crores by end of the current quarter. For the balance 6-month period, disbursement is expected to be north of INR 1,000 crores per month. Confident of building a robust portfolio and overachieving growth guidance. Growth guidance revision is u

Future growth expectations in earnings/operating earnings/profits/EPS?

Management is confident of building a robust portfolio and overachieving growth guidance, with business growth already up 15-18% in July and expected to improve further in August and beyond (Page 18). Anticipate a positive revision on growth, but will wait 1-2 quarters to revise guidance, with confidence to outdo growth and maintain credit cost guidance (Page 17). Credit cost expected to remain at lower end or below guidance of 4%-6%, aiding improved ROA and ROE (Page 17). Operating cost rationalization expected, targeting operating expense ratio around 6.2% (Page 17). NIM expansion expected d

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Muthoot Microfin LtdQ2 FY25Finance

Muthoot Microfin Ltd Q2 FY25 Earnings Call Analysis

Revenue, margin, capex, fundraise and order book outlook from management commentary.

Price: ₹211Market Cap: ₹3.3K CrSector: Finance

Management growth scorecard

Revenue

Category 3

Margin

Category 2

Fundraise

N/A

Order

Yes

Capex

1 of 4 growth signals are positive — mixed outlook.

Full analysis

Revenue guidance

Category 3

→Q4 disbursement was only 9.4% higher than Q1, despite Q1 being a slower quarter for lending entities.
→July 2025 saw a 15%-18% increase in business, with further improvement expected in August and beyond.
→Disbursements increased from around INR 630 crores in Q4 FY25 to INR 727 crores in July, with a target of INR 800-850 crores soon and close to INR 1,000 crores by end of the current quarter.
→For the balance 6-month period, disbursement is expected to be north of INR 1,000 crores per month.
→Confident of building a robust portfolio and overachieving growth guidance.
→Growth guidance revision is under consideration but management plans to watch 1-2 more quarters before updating.
→Expectation of consistent growth aided by diversification, technology, and improved collections.

Margin guidance

Category 2

→Management is confident of building a robust portfolio and overachieving growth guidance, with business growth already up 15-18% in July and expected to improve further in August and beyond (Page 18).
→Anticipate a positive revision on growth, but will wait 1-2 quarters to revise guidance, with confidence to outdo growth and maintain credit cost guidance (Page 17).
→Credit cost expected to remain at lower end or below guidance of 4%-6%, aiding improved ROA and ROE (Page 17).
→Operating cost rationalization expected, targeting operating expense ratio around 6.2% (Page 17).
→NIM expansion expected due to cost of funds rationalization and revised lending rates, improving profitability (Page 11).
→No major branch expansion; focus on leveraging existing infrastructure for efficient growth (Page 10).
→Overall, management is optimistic for consistent earnings and profitability growth supported by diversification, technology, and improved collections (Page 18).

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Fundraise plans

→Muthoot Microfin has raised INR 1,450 crores during the quarter through Pass Through Certificates (PTC), reducing the cost of funds by 23 bps.
→They have recently completed a large PTC transaction of around INR 500 crores with State Bank of India.
→The company is actively utilizing multiple funding sources including PTC deals with private sector banks like HSBC and DBS.
→There is active interest from Development Financial Institutions (DFIs) and foreign banks, especially through the External Commercial Borrowing (ECB) route.
→Liquidity is strong with over INR 2,000 crores available through pre-funding, investments in government securities (High Quality Liquid Assets), and undrawn sanctions.
→The company is optimistic about future fundraises owing to improving market conditions and increased activity in the NCD and CP markets.
→No explicit mention of raising equity funds during the recent quarter or near future.

Order book

Yes

The provided document does not contain explicit information regarding current or expected orderbook or pending orders for Muthoot Microfin Limited. It primarily discusses: - Loan disbursements and portfolio growth. - Product diversification strategies. - Credit cost guidance and collection efficiencies. - Branch expansion and customer base growth. - Liquidity and funding status. - Market environment and regulatory impacts. No direct mention of orderbook or pending orders is found in the transcript or management discussion. If you require information about these aspects, it might be necessary to refer to other company filings or communications.

Capex plans

→Currently, Muthoot Microfin Limited is focusing on calibrated branch expansion, having opened 27 new branches while closing 1, reaching a total of 1,726 branches.
→The company plans to rationalize branches with low profitability or high operating cost, especially in UP and Bihar, while deepening presence in newer territories like Assam, Telangana, and Andhra Pradesh.
→No large-scale CAPEX is planned for new branch infrastructure; instead, they are leveraging existing branches to roll out new products such as Loan Against Property (Micro LAP), gold loans, and individual MSME loans.
→A strategic co-lending tie-up with their parent company for gold loans has been approved, which requires minimal operating cost and capital expenditure.
→Investments in technology include adoption of GenAI-based credit underwriting and centralizing credit appraisal processes to enhance operational efficiency.
→Overall, capital expenditures appear prudent and are focused on optimizing branch network and diversifying product offerings without significant large-scale capital outlay.

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