Muthoot Microfinance shares rise 6% as firm wins corporate agent licence from IRDAI

Shares of Muthoot Microfinance gained over 6% in the afternoon session on Tuesday after the firm said it has won a corporate agent licence from the Insurance Regulatory and Development Authority of India (IRDAI). The licence will enable it to offer tailored insurance plans to its customer base.

Muthoot Microfinance stock gained 6.39% to Rs 258 against the previous close of Rs 242.50 on BSE.  Market cap of the firm  rose to Rs 4205 crore. Total 0.74 lakh shares of the firm changed hands amounting to a turnover of Rs 1.85 crore. Market cap of Muthoot Microfinance rose to Rs 4205.19 crore on BSE.

In terms of technicals, the relative strength index (RSI) of Muthoot Microfinance stands at 63.7, signaling it's trading neither in the overbought nor in the oversold zone. Muthoot Microfinance shares are trading higher than the 5 day, 10 day, 20 day, 30 day, 50 day and 100 day moving averages. 

The corporate agent license will help Muthoot Microfin negotiate better with insurance partners and customize products to suit the needs of its BOP (Bottom of the Pyramid) customers in rural and semi-urban areas across India. With this new licence, Muthoot Microfin can offer the right insurance products to its customers while augmenting its sources of revenue and earnings, the company said.

Commenting on the move, Sadaf Sayeed, CEO, Muthoot Microfin said, “At Muthoot Microfin, we are always seeking new avenues to better serve our microfinance customers. This development with IRDAI empowers us to bridge the protection gap for our microfinance customers. We can utilize our network of 1,508 branches spread across 19 states to reach out to 3.35 million customers. This extensive reach can be achieved without any additional expenditure. It also provides us with the opportunity to earn additional revenue in the form of commissions, which will directly contribute to our bottom line and improve our ROAs.”