Gold loan business minting money for investors

Muthoot Finance Ltd [MFIN] raised Rs 43 crore from Kotak India Private Equity Fund. The deal valued  MFIN, the largest gold loan company according to ICRA, at around Rs 3,925 crore. Baring Private Equity Partners India and Matrix Partners India had infused Rs.157 crore in MFIN last month.

Kerala is home to many large scale gold loan companies in India - Muthoot Finance [MFIN], Muthoot Pappachan, Mini Muthoot, Manappuram and Kosamattam. All Muthoot names are from a single family with separate business run by brothers and cousins. Muthoot boasts a tradition of 123 years. Among this Manappuram is the most aggressive in marketing using regional and national film stars in their campaigns. Lately Sequoia Capital exited Manappuram General Finance & Leasing with 5x returns. As such the business model of these NBFCs are not lucid. Also, almost all banks worth their name in India is offering gold loans at their branches questioning the sustainability of these NBFCs.


Comments

  1. AnonymousNovember 30, 2011 at 7:49 AM

    gold is costing about Rs.23000/-per 8 gms and is one of the most sought after valuables of malyalees and it is really as salt is to food i.e. inseparable from malyalee culture.==saajan

    ReplyDelete
  2. UnknownApril 25, 2013 at 4:49 PM

    Gold Loan is the cheapest loan scheme for the people who need instant cash to meet the short term needs. The person has to put the gold as security and money is given to the customer as soon as possible. Any person who possesses gold and needs urgent cash can apply for this loan against gold. It is the smart way to handle the financial crunch of life.

    ReplyDelete

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