IIFL Finance Ltd. on Tuesday said that the global credit rating agency Standard and Poor's (S&P) has revised the company's outlook to 'Positive' from ‘Stable' on recovering market share in gold loans.
S&P, in its rating rationale, said, 'The outlook revision reflects IIFL's strengthening market share in the gold financing business. This is a year after a central bank embargo on the company sanctioning or disbursing fresh gold loans was lifted. We expect IIFL to maintain very strong levels of capitalisation over the next 12 months.'
S&P also anticipated that the company's portfolio pruning and reduced exposure to microfinancing will lower its credit costs.
It further said that the IIFL's credit costs will peak this fiscal year ending March 31, 2026.
The rating agency said the company's risk-adjusted capital (RAC) ratio will moderately decline to 18-19% over the next two years, compared with 20.4% as of March 31, 2025, it said.
'Our positive outlook on the long-term issuer credit rating on IIFL reflects our view that the company will strengthen its market share and maintain robust capitalisation over the next 12 months,' it said.
The rating agency projected that IIFL's credit costs will decline after FY26, and that the company will likely maintain access to funding despite its sensitivity to market confidence.
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