India's Muthoot Finance misses Q4 profit view as expenses jump
BENGALURU (Reuters) - Muthoot Finance Ltd reported a smaller-than-expected fourth-quarter profit on Friday, as demand for loans dropped amid weak macroeconomic environment.
The gold financing company reported a profit of 9.03 billion rupees ($110.42 million) for the three months ended March 31, down from 9.60 billion rupees a year earlier, it said in an exchange filing.
Analysts on average were expecting a profit of 9.46 billion rupees, according to Refinitiv IBES data.
The gold loan industry has continued to benefit from a surge in the metal's prices amid an increase in safe-haven investment in gold due to market volatility.
Goal loan industry as a whole has seen a surge in their cost of funds amid rising interest rates, driving potential borrowers away. The macroeconomic environment has driven the interest rates on loans higher during the quarter.
Additionally, the company was hurt by an expense of 752.9 million rupees during the quarter, taking its total expenses up about 19%.
Revenue from services and service charges dropped 28% and 12%, respectively.
Muthoot's interest income, which is the difference between interest earned and paid, rose 5.8% to 27.94 billion rupees in the quarter.
($1 = 81.7800 Indian rupees)
(Reporting by Ashna Teresa Britto in Bengaluru; Editing by Rashmi Aich)