Muthoot Microfin Ltd. reported a sharp decline in net profit for the first quarter of FY25, as higher non-performing assets (NPAs) and credit costs eroded earnings. The microfinance institution, which primarily serves low-income rural borrowers, faced increased repayment stress, partly attributed to erratic monsoon patterns and inflationary pressures impacting borrowers’ cash flows. Despite growth in its loan portfolio, the company’s bottom line contracted as provisions for bad loans rose significantly.
