Gold Finance - Shining Gold Prices Positive For Gold Loan Growth: Motilal Oswal
Higher gold prices have led to better gold loan demand and is also contributing to a significant decline in gold auctions.
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Motilal Oswal Report
Key highlights from our channel checks in Southern India for gold loan non banking financial companies in general and Muthoot Finance Ltd. in particular are:
higher gold prices have led to better gold loan demand and is also contributing to a significant decline in gold auctions,
both Muthoot Finance/Manappuram Finance Ltd. have not made any notable changes to their gold loan schemes in Jan-23, which make it unlikely for gold loan NBFCs to re-introduce any teaser-rate loans to accelerate loan growth,
the competitive landscape still remains highly aggressive suggesting little scope for any marked improvement in spreads/margins beyond what was reported in Q2 FY23, and
Metro cities/tier-I towns acknowledge that gold fin-techs such as Rupeek and Indiagold offer lower pricing and are still the biggest competition.
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