Manappuram Finance Limited

“Manappuram's gold loan franchise is a genuinely good business — high NIMs, near-zero credit losses, real moats — but management's capital allocation into Asirvad MFI has diluted consolidated returns, introduced governance risk (RBI sanction), and created earnings opacity. At 11.2x forward P/E and 1.97x book, the stock is pricing in MFI normalization that is far from assured. The downside is cushioned by collateral-backed gold assets, but there is no margin of safety and no compelling reason to own it over a pure-play like Muthoot. Track for a better entry on further MFI credit deterioration or clear NPA cycle evidence.”