Mumbai: Non-banking finance company Muthoot FinCorp has begun discussions with bankers to raise about ₹4,000-5,000 crore through an initial public offering that may value the company between ₹25,000 crore and ₹28,000 crore, three people familiar with the matter said.
Muthoot FinCorp, which operates under the Muthoot Pappachan Group, is in talks with several domestic and global advisors, including Kotak Mahindra Capital, Morgan Stanley and JM Financial, although no formal appointments have been made, one of the people cited above said on the condition of anonymity.
“The initial feelers from the market suggest that the company will be valued in the ₹25,000-28,000 crore range. However, it's early days and valuation discovery is still ongoing,” a second person confirmed.
The person added that there will be more clarity after the final appointments happen in the coming weeks. “The company will only have a fresh issue component and the listing will potentially happen next year, subject to market conditions,” a third person said.
The proposed IPO will add to the growing pipeline of companies seeking to tap the public markets this year. For Muthoot Fincorp, one of India's largest gold loan non-banking finance companies, the IPO proceeds will help expand its digital reach and establish it as a diversified, technology-enabled financial services company.
In response to Mint's queries, a company spokesperson said, “As previously disclosed, the Board has approved the proposal for an IPO of ₹4000 crore. At this stage, no formal appointment of bankers has been made to the proposed offering. The company will make appropriate disclosures in accordance with applicable regulatory requirements as and when required.”
The company, on 16 May, said its board had cleared a proposal to raise up to ₹4,000 crore through an IPO. However, the issue could be upsized depending on market demand, one of the three people cited above said.
Kotak Mahindra Capital, Morgan Stanley and JM Financial did not immediately respond to Mint’s requests for a comment.
Strong growth
Muthoot Fincorp is moving from a single-product company to one serving a social segment with multiple products, its chief executive Shaji Varghese told Mint in an interview last month.
The company, which has about 3,800 branches, posted robust performance with its assets under management reaching ₹56,185 crore and over ₹1,640 crore in net profit and revenue at ₹8,364.28 crore for FY26.
It also plans to raise another ₹8,000 crore through non-convertible debenture (NCD) issuances and has put in place a ₹30,000 crore commercial paper programme. The group’s digital fintech product, Muthoot FinCorp ONE, is central to that ambition and the app has already reached about 7 million downloads and 2 million monthly active users.
The board has also approved up to ₹4,000 crore of public non-convertible debenture (NCD) issuance between 1 July 2026 and 30 June 2027, up to ₹4,000 crore via private placement of NCDs, perpetual debt instruments and subordinated debt, and a commercial paper programme with a ₹30,000 crore issuance limit and ₹10,000 crore outstanding cap.
The debt side is just as important as the company deliberately broadens its funding base, shifting away from a heavy dependence on bank borrowings. As of 31 March 2026, the standalone balance sheet showed debt securities of ₹5,205.8 crore, borrowings of ₹34,676.8 crore, subordinated liabilities of ₹3,726.7 crore and cash and cash equivalents of ₹1,952.8 crore. The company also disclosed a debt-to-equity ratio of 6.61 and a total debt-to-total assets ratio of 83.96%.
Muthoot Finance and Muthoot FinCorp are two separate, distinct companies operating under the broader Muthoot Group umbrella. Muthoot Fincorp competes with players such as Manappuram Finance and IIFL Finance in the non-banking sector.