Muthoot Finance Outperforms Manappuram in Q2FY26 Amid Gold Loan Boom

The gold loan market in India has been on a strong upward trajectory, with the total outstanding loans reaching Rs 3.16 lakh crore as of September 2025, up from Rs 1.47 lakh crore a year earlier. This surge in demand has significantly benefited the two leading gold loan NBFCs, Muthoot Finance and Manappuram Finance.

In the second quarter of fiscal year 2026 (Q2FY26), Muthoot Finance, the country's largest gold loan financier, has emerged as the clear winner over its closest rival, Manappuram Finance. Muthoot's average loan yield improved to 19.99% from 18.65% a year earlier, while its net interest margin (NIM) expanded to 11.2% from 9.6%. This, combined with a 45% year-over-year growth in its gold loan assets under management (AUM) to Rs 1.24 lakh crore, helped the company's standalone net profit jump nearly 87.5% to Rs 2,345 crore.

In contrast, Manappuram Finance faced some challenges, with its net yield declining to 19.7% from 22% a year earlier. The company also saw higher impairment costs and operational expenses, leading to a nearly 20% year-over-year drop in its standalone net profit to Rs 375.9 crore.

The strong performance of Muthoot Finance has further widened the gap between the two gold loan giants, as investors remain bullish on the sector's long-term growth prospects. Despite the rich valuations, with Muthoot trading at a price-to-earnings (P/E) ratio of 20.6 and Manappuram at 14.6, the stocks are likely to continue attracting investor interest.