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• blogpostTitle: Manappuram Finance Q4 FY26: Gold loans drive growth as non-gold cleanup continues */

Manappuram Finance Q4 FY26: Gold loans drive growth as non-gold cleanup continues

Manappuram Finance ended Q4 FY26 with a sharp acceleration in assets under management, driven overwhelmingly by gold loans. Consolidated AUM stood at 63,798 crore as of March 31, 2026, up 22.4% quarter-on-quarter and 48.3% year-on-year. The core gold loan book rose to 50,953 crore, up 31.5% sequentially and 99.1% year-on-year.

The profit picture was more mixed. Consolidated PAT for the quarter was 405 crore, up 69.7% sequentially, while full-year consolidated PAT was 993 crore, down 17.5% year-on-year. Management commentary and disclosures point to a familiar trade-off for diversified lenders in the current cycle: secured gold lending is performing strongly, while select unsecured and non-gold secured books still require tighter underwriting and collections-led cleanup.

A key structural shift in the consolidated mix is visible in the portfolio composition. Gold loans now account for 80% of consolidated AUM in Q4 FY26, up from 59% a year ago. The non-gold consolidated AUM declined year-on-year, reflecting the company’s stated calibrated approach to risk-adjusted growth.

Gold loans: scale, productivity, and a strongly digital operating model

Gold loans remained the cornerstone. The investor deck highlights a stable average LTV of 57% as of March 31, 2026. Consolidated gold holdings increased to 63.0 tonnes in Q4 FY26 (from 59.0 tonnes in Q3 FY26), while the customer base continued to expand.

A notable operating feature is the scale of Manappuram’s online gold loan product. The presentation shows online gold loans at 92% of overall gold AUM in FY26. Management reiterated continued investments in digital capability, analytics, and process efficiency to improve turnaround time and productivity.

Productivity indicators in the deck show a sharp rise in gold AUM per branch, reaching 13.9 crore in FY26. Average gold loan ticket size also increased materially in FY26 to 127.7 thousand rupees, versus 67.8 thousand rupees in FY25.

On the earnings call, management said new RBI guidelines on lending against gold collateral have enabled product broadening in a structured manner. They described two loan types: consumption loans for household needs and income generating loans for small business and livelihood purposes. The company also indicated that the new framework requires credit assessment for certain borrowers and can improve due diligence and cross-sell opportunities.

Financial snapshot: growth with profitability shaped by provisioning and mix

Consolidated financials for Q4 FY26 showed net interest income of 1,504 crore, operating expenses of 737 crore, and provisions of 216 crore. Full-year consolidated net interest income was 5,724 crore, down year-on-year, with provisions of 1,556 crore.

Standalone performance (Manappuram Finance Ltd entity) also reflected strong gold loan growth, with standalone AUM at 55,952 crore in Q4 FY26, up 26.6% quarter-on-quarter and 69.4% year-on-year. Standalone PAT for the quarter was 376 crore, marginally down sequentially.

During Q&A, management clarified that standalone profitability was impacted by higher provisioning from the non-gold portfolio, including a vehicle finance write-off. The call cited a 136 crore write-off in vehicle finance, with 84 crore described as net of provision.

The funding and liquidity narrative was supportive. The investor deck shows consolidated cost of borrowing trending down to 8.6% in Q4 FY26 from 9.4% in Q4 FY25. Consolidated cash and cash equivalents were disclosed at 6,149 crore at end of March 2026. Capital adequacy remained healthy, with CRAR reported at 21.3%.

Asirvad Microfinance: cautious recovery, but Q4 aided by write-backs

Microfinance continues to be described by management as a recovery-phase business, with improvements emerging but not yet fully normalised. In the investor deck, Asirvad’s MFI AUM is shown at 4,636 crore in Q4 FY26, up 3.9% quarter-on-quarter but down 35.7% year-on-year. The deck also shows Asirvad’s full AUM including gold loans and MSME.

Asirvad reported PAT of 13 crore in Q4 FY26 versus a loss of 156 crore in Q3 FY26, while the full-year PAT remained negative at -579 crore. On the call, management explained that the quarter’s lower provisioning was driven by MTM credits on security receipts and an ECL write-back due to the strong performance of the new pool. The stated MTM plus ECL change was about 128 crore pre-tax.

Asset quality metrics improved versus the stressed FY25 base. The investor deck shows Asirvad GNPA at 4.8% in FY26 versus 8.5% in FY25, and net NPA was stated at 1.6% in Q4 FY26. Management also provided ECL percentages by stage during Q&A.

Management commentary emphasised continued tight underwriting, calibrated disbursements, strengthened collections, and geographic optimisation. This positioning is consistent with the broader sector context described in the opening remarks: certain unsecured segments, particularly microfinance, have faced pressure, though management sees early signs of stabilisation.

Non-gold segments: deliberate moderation while collections are strengthened

The investor deck shows that the company’s non-gold segments have either moderated or grown selectively.

Vehicle and equipment finance AUM fell to 2,991 crore in Q4 FY26 from 3,595 crore in Q3 FY26, with GNPA at 10.4% in Q4 FY26 (down from 13.7% in Q3 FY26). Management described several collection-focused initiatives, including separate teams for soft and hard buckets and greater emphasis on digital follow-ups.

Housing finance remained stable, with AUM at 1,852 crore in Q4 FY26, slightly down sequentially but marginally higher year-on-year. GNPA for housing finance improved to 2.6% in Q4 FY26 from 4.9% in Q3 FY26, as per the deck.

MSME and allied lending AUM increased modestly to 3,351 crore in Q4 FY26, but GNPA rose to 7.1% from 6.1% in the prior quarter. The deck also states that new disbursements in digital personal loans and unsecured personal loans have been stopped.

Corporate developments: change in control and board reconstitution

A material corporate announcement dated May 5, 2026 disclosed that BC Asia Investments entities acquired control of the company from April 21, 2026 and became promoters along with the existing promoters. The board noted that amended and restated articles of association became effective and that special rights under the agreements became effective.

The same announcement disclosed resignations of six independent directors effective May 5, 2026 and the appointment of additional directors nominated by the investors, along with the appointment of new independent directors subject to shareholder approval. It also disclosed changes in designations, including the CFO role moving to the Group CFO.

These governance changes add an important layer for investors to track in FY27, particularly in how capital allocation, risk appetite, and portfolio strategy evolve under the new promoter structure.

What to watch from here

Management’s forward commentary focused on sustaining gold loan momentum and improving profitability through operating efficiency and stable funding costs. On the call, management indicated an expectation for gold loan yields to stabilise around 17.5% to 18% and stated that consolidated ROE is expected to improve over the next one to two years.

A key operational lever highlighted was expansion. Management said it plans to open 500 to 550 gold loan branches during FY27, aided by regulatory changes removing the need for prior approvals for opening branches.

The near-term investment debate for Manappuram is likely to revolve around two simultaneous tracks: the sustainability of gold-led growth and the pace at which non-gold portfolios, especially microfinance and vehicle finance, normalise in terms of credit cost and profitability. The Q4 print shows strong momentum in the core engine, but also shows why the market will continue to focus on the quality of earnings and the durability of improvements in the stressed books.