Why Is Muthoot Finance Share Price Falling Today? Gold Loan NBFC Crashes 11% Despite Upbeat Q3; Target Price

Muthoot Finance Share Price Today: Shares of Muthoot Finance crashed nearly 11.33% on Friday, February 13, despite the gold loan NBFC reported 95% surge in net profit during the third quarter of the financial year 2025-26.

Muthoot Finance shares were trading 11.33% lower at Rs 3608 per share on BSE with a market capitalisation of Rs 1,44,849.83 crore at 10:07 am on Friday. The stock had hit an intraday low of Rs 3576.60 per share in the first thirty minutes after the stock market opening.

Why Is Muthoot Finance Share Price Falling Today?

"Muthoot Finance shares sharply fell following a strong Q3 earnings that highlights a classic market disconnect between earnings numbers and expectations. The company made a big profit, but investors were looking not only at growth but also at signs of improving asset quality, stable spreads and a clear credit cost guidance," explained Siddharth Maurya, Founder & Managing Director, Vibhavangal Anukulakara Pvt. Ltd.

"Since there were no strong forward cues especially on loan, book growth, NPA trends and margin outlook, the market opted to book profits. Very often, such a reaction signals valuation re, rating rather than a fundamental weakness. Performance over the medium term will depend on execution, credit discipline and guidance clarity," added Maurya.

Muthoot Finance Share Price Recommendation

While Muthoot Finance share price declined significantly during the Friday's intraday trade, brokerages continue to remain bullish on the gold loan NBFC stock. The Kochi-based gold loan NBFC posted a stellar loan growth of 50% on an annual basis during the third quarter. Net Interest Margins also remained stable on a quarterly basis.

The company saw a robust loan growth, better NPA recoveries, and spread expansion of 5bp QoQ to 11.85% as yields rose owing to NPA recoveries, noted Motilal Oswal in its report released on Friday. The brokerage gave a 'Neutral' recommendation for the stock.

Strong Asset Under Management (AUM) growth, increase in NIM and decline in GS3 ratio were among the key positives for Muthoot Finance, noted Nuvama in its report.

Muthoot Finance Share Price Target

Motilal Oswal has maintained a 'Buy' rating for Muthoot Finance stock with a target price of Rs 4,500 per share. "With its ability to deliver industry-leading gold loan growth and best-in-class profitability, MUTH is one of the best franchises for gold loans in the country. Maintain our Neutral rating with a revised TP of INR4,500 (based on 3.3x Dec'27E P/BV)," noted the brokerage in its report.

Meanwhile, Nuvama maintained a 'Buy' rating for the stock with a target price of Rs 4,700 per share. "Given strong and better-than-peers earnings and Muthoot's ability to
shield loan yields from rising competition, we maintain 'BUY'. We are revising TP to INR4700/4.2x BV FY26E from INR4,000. Demand for gold loans from low-income borrowers will remain strong. The regulator is supportive of gold finance with new branch openings now relaxed," noted Nuvama in its report.

Muthoot Finance Q3 Recap

Muthoot Finance Ltd reports a sharp jump in profitability for FY26 so far, highlighting strong demand for gold-backed lending. The non-banking lender posts higher profit after tax both for the third quarter and for the first nine months, alongside a sizeable expansion in its loan book.

For the nine months of FY26, Muthoot Finance Ltd records PAT of Rs 7,048 crore, compared with Rs 3,693 crore in 9M FY25, a rise of 91 per cent. Overall loan AUM for 9M FY26 reaches Rs 1,47,552 crore, up from Rs 97,487 crore in 9M FY25.

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