Shares hit an over two year low of Rs 89.10, down 4.5 per cent on Tuesday's intra-day trade, as investors hammered the stock over growth concerns. With a combined 9.52 million equity shares changing hands on the NSE and BSE until 02: 25 pm, trading volumes on the counter jumped 1.5 times. The S&P BSE Sensex was down 0.63 per cent at 53,948 level, according to the S&P BSE SensexBSE Sensex.
Since March 2020, the stock of the non-banking financial company NBFC engaged in gold loan business was trading at its lowest level since March 2020. In the past month, it has slipped 25 per cent, compared to a 5 per cent decline in the S&P BSE SensexBSE Sensex.
For January-March quarters, FY 22 reported 44 per cent decline in its consolidated net profit at Rs 261 crore due to higher operating expenses. In Q 4 FY 21 the company's net interest income fell 10.2 per cent to Rs 986 crore from Rs 1,098 crore and the consolidated asset under management AUM fell to Rs 30,300 crore from Rs 30,400 crore in Q 3 FY 22. The company said that the net profit was temporarily affected due to the shift from high yield to lower yield gold loans.
The company's assets quality worsened on a standalone basis in the quarter as gross non-performing asset NPA and net NPA ratio increased by 160 basis points bps and 170 bps quarter on quarter QoQ to 3 per cent and 2.7 per cent, respectively.
Manappuram's gold loan portfolio de-grew by 1.4 per cent QoQ due to competition intensity from NBFCs, according to analysts. MFI reported a deterioration in asset quality as GNPA stood at 3.5 per cent versus 2.8 per cent QoQ and also reported loss of Rs 7.1 crore. Management has revised guidance for gold loan growth at 10 per cent earlier in the year 23. We downgraded estimates by 7 per cent FY 24 EPS because competition intensity from NBFCs affects growth prospectus. In a result update, IDBI Capital said we need to watch out for recovery in the MFI portfolio in FY23.
ICICI Securities said that there are challenges despite recent corporate results in many sectors, despite the management's optimism on demand outlook. The outlook is further weighed down by the weaker than peer growth performance of Manappuram in both gold and MFI segments.