Crisil Projects Robust Profitability and Growth for Gold-Loan NBFCs in FY26-FY27

Gold-loan focused non-banking financial companies (NBFCs) are projected to maintain robust profitability with return on managed assets of 4.25-4.5% in FY26 and FY27, driven by strong loan growth, improved operating leverage, and low credit costs, according to Crisil Ratings. Assets under management are expected to grow at an annualized rate of around 40%, outpacing branch expansion. Factors supporting growth include rising gold prices, a shift from unsecured to gold loans, and regulatory changes allowing higher loan-to-value ratios and branch flexibility. Competition from banks and diversified NBFCs is increasing, but credit costs remain below 1%, supported by prudent norms and recovery mechanisms.