Capri Global Capital is targeting around 40 per cent growth in its gold loan portfolio this year, with rising gold prices supporting both loan growth and asset quality, Managing Director Rajesh Sharma said. The non-banking financial company (NBFC) is also planning to add 400 branches by December, with most of the new outlets expected to focus on gold loans.
Capri Global’s gold loan portfolio grew 111 per cent last year and has reached nearly Rs 20,000 crore since the company entered the business in 2022. The company is now targeting a gold loan book of around Rs 28,000 crore, with expansion expected to come through its branch network and data science-led initiatives aimed at improving employee productivity.
Gold Prices Support Loan Growth
Sharma said higher gold prices allow borrowers to raise larger amounts against the same collateral, creating room for portfolio expansion. Higher collateral values can also help the company maintain loan-to-value ratios within acceptable levels.
Capri Global’s realised yield on its gold loan portfolio is currently around 18.6 per cent, while the company expects it to remain in the 18-18.5 per cent range during the year. The lender is focusing on smaller-ticket gold loans rather than competing aggressively in larger-ticket loans and teaser-rate offerings. The company also expects limited pressure on funding costs, with short-term instruments such as commercial paper available to fund its short-tenure gold loan portfolio.
Asset Quality Remains Stable
Sharma said Capri Global has so far not seen significant deterioration in its secured MSME, affordable housing or gold loan portfolios. While higher input costs could create some margin and cash-flow pressure for MSMEs, the company has not seen a meaningful rise in cheque bounces, asset-quality stress or weakening demand.
For gold loans, Capri Global follows a strict LTV framework. Its current portfolio-level LTV is around 72 per cent, while certain income-generating loans can go up to 80 per cent depending on the borrower’s income and repayment history. Consumption-oriented gold loans are generally capped at 75 per cent at disbursement. Sharma said the company’s LTV monitoring and collection processes will remain important as it scales the gold loan business.