Manappuram Finance Limited

Manappuram Finance Limited was incorporated in the year 1949 by V. C. Padmanabhan in the coastal village of Valapad in Thrissur District, Kerala. The company's main business was pawn broking and money lending. Mr. Nandakumar took over the business after his father in the year 1986. Today Manappuram Finance Limited has around 5,200 branched across 28 states / union territories across the country. The assets under management (AUM) stands at Rs.420.69 billion with employees more than 50,000.

Services offered by Manappuram Finance Limited does not stops with just Gold loans. They also provide 

• Vehicle Loans
• 
  Two Wheeler Finance
• Personal Loan
• Micro Home Finance
• Business Loan
• Forex & Money Transfer
• Healthcare Industry Loan
• Small Scale Industries Finance
• Restaurant Finance
• School Finance
• Corporate Finance
• Demat Account Services

PB ratio of the company stands at 1.34, which says the company is not trading at an expensive price. PE ration of the company stands at 7.13, this is also under the permissible range to buy and hold for long term. The share price is around Rs.183. A normal middle class person in India can invest systematically at this price. When we consider the past 5 years growth of the company, it was around 30% as of October 2024. From investor point of view, stock with good business background is trading with less price.

Revenue of the company consistently increased every year and it stands at 8,848 crores as of 2024. Net profit of the company also increased to 2,197 crores as of 2024. EPS (Earning per share) was 17.72 in 2023 and it is 25.96 in 2024. The Book value of the company stands at 136.77 in 2024, it was 114.19 in 2023. Foreign investors holding increased from 28.95% in December 2023 to 33.00% in June 2024. Debt to equity of the company considerably reduced from 3.82 in 2020 to 2.91 in 2024. 

Manappuram Finance Limited mainly deals with gold loan and finances. Considering the gold price in India, which is expected to grow exponentially in coming years. When the gold price increases, the lending amount increases for the company by having the enough security. Hence the interest collected on those can be higher as well. As the loan is provided by collecting the gold as collateral, the companies will not have the concept of NPA. If any borrower defaults the loan amount, the company can auction the gold as per the procedure and recover the amount.

Person who are interested in long-term wealth generation can consider investing in this company slowly and steadily. Hope this blog brings you more information about Manappuram Finance Limited.

Have a Great Day

B G Nareshkumar