I have shared auction nos regularly on this thread. Whenever industry goes through headwinds, Manappuram is the first to report auctions, as their loan tenure is the shortest. Also, Manappuram’s auction are generally on the higher side over time.
The reason why Manappuram and Muthoot have been struggling for growth is they haven’t gone into colending model vs new age cos which are doing colending with banks. Banks have lower cost of borrowing and if they can find distribution partners (like NBFCs), they can offer much lower rates. Additionally, most banks only expect 2-3% ROA from this segment, whereas Manappuram/Muthoot are used to operating at 5%+ ROAs over cycles. Its anyone’s guess if this colending model is a terminal risk for traditional gold financiers.
In my personal observation, every few years lending cos come up with a new model (e.g. securitization, colending, etc.) which are considered superior, works for a few years, and then blows up.
Disclosure: Invested in Manappuram Finance (position size here, no transactions in last-30 days)