Thaindian News

Kochi, Sep 20 (IANS) Asset finance company Magma Fincorp Limited is gearing up its branch network and sales promotion activities for greater financial inclusion and deeper penetration into regions where banks cannot enter to provide credit to the masses, a top official said.
“We plan to go deeper. The company currently operates in 21 states, through 166 branches covering about 2,000 marketing clusters, which are mostly in semi-urban and rural areas. The plan now is to penetrate deeper into the semi-urban and rural markets thereby reaching out to a much larger number of clusters,” Ashutosh Shukla, chief operating officer of the company told a group of visiting reporters here.

The company now works on a hub and spoke model and each branch caters to various clusters in a radius of 125 kilometres. It plans to increase its number of branches also by the end of 2010-11.

“The company has opened 13 branches this year and is working on starting another 14 by March 2011,” he said.

The Kolkata-based non-banking company finances a host of products-utility vehicles and cars, commercial vehicles, tractors and small and medium enterprises (SME) loans.

The main focus area for the company in the coming days would be in the tractors, SME and used vehicle financing.

The company plans to continue to focus on the rural and semi-urban market which has been its major strength area, he said.

Of the company’s total disbursement, 40 percent is in the urban market and 60 percent in the semi-urban and rural markets.

“We plan to maintain this focus this year too,” said company national sales head Sumit Mukherjee.

Magma disbursed Rs.4,559 crore in 2009-10. The asset under management of the company till March 2010 was Rs.9,481 crore and the net interest margin (NIM) of the company was 5.1 percent during the same period. NIM target for 2010-11 is 5.5 percent.

The shareholding of Magma is - 41.8 percent with the promoters, 9.8 percent with the public, 38.7 percent with foreign institutional investors, 9.7 percent with domestic investors.

The company is aggressively working towards increasing its visibility among various parts by increasing sales activities.

“More than 1,000 sales and marketing promotion activities have been planned per month. The initiative was started in August 2010 and is currently being scaled up to reach the monthly figure of over 1,000 activities by January 2011,” Shukla said.

The company is currently holding about 300 daily sales promotion activities across the country.