Shares of Muthoot Finance Ltd staged a sharp intraday recovery on Tuesday after falling nearly 10% in early trade, following a clarification from RBI Governor Sanjay Malhotra regarding the upcoming gold loan guidelines.
At around 11:00 AM, the stock had plummeted to Rs 2,079.20, down 9.31% from the previous close of Rs 2,292.65, amid investor concerns that the new RBI regulations might tighten norms for gold-backed lending. However, after the governor clarified that the guidelines were not meant to tighten but to harmonise and rationalise conduct norms, the stock rebounded significantly, recovering over 5% from its intraday low to trade at Rs 2,182.55, down only 4.80%.
Malhotra addressed market concerns, stating, “I never said we will tighten gold loan rules in my statement. Let’s wait for the guidelines which will be issued soon. To our mind, there is no tightening, it is rationalisation. It is harmonisation on conduct side only.”
Earlier in the day, the RBI had announced that it would issue comprehensive draft regulations for gold loans issued by banks and NBFCs, aiming to unify and enhance prudential and conduct-related norms. The guidelines are expected to be released for public comments later today.
Stock Update (as of 12:21 PM):
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Price: Rs 2,182.55
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Change: -110.10 (-4.80%)
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Day’s Range: Rs 2,011.25 – Rs 2,307.55
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Market Cap: Rs 871.99 crore
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P/E Ratio: 17.38
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Dividend Yield: 1.11%
The RBI’s clarification has offered some relief to investors, particularly as Muthoot Finance and peer Manappuram Finance are major players in the gold loan segment.
