The third quarter results of Magma Fincorp Limited, which were announced today reflect increase in disbursements, Revenue, PAT and in Assets under Management (AUM) over corresponding quarter last year on the back of an industry recovery and strong all-round performance by the company. The disbursements increased 19% to 1049 crores while revenue increased 15% to Rs 182.0 crores.
The company recorded Profit before Tax (PBT) of Rs 27.3 crore recording 164% increase and Profit after Tax (PAT) of Rs 17.9 crore, an increase of 161% over the corresponding period last year. The AUM as on 31 December 2009 was Rs 9390 crore. Magma has been on a high growth curve since August 2009 and in the quarter ended 31 December 2009 gathered momentum to register positive performance in all products. The company increased disbursements by 19%% over the corresponding quarter last year and 18% over the immediate previous quarter and 43% over the first quarter of the current financial year. Magma during the quarter under review continued to increase share of the newer high yield products such as Tractor Loans, SME Loans and Suvidha Loans in the business which contributed to an improvement in the Net Interest Margin (NIM) from an average 3.6% of last year to 5.1% year to date. Magma has dealt with the economic slowdown through a series of initiatives including introduction of additional business verticals, strong focus on asset quality and effective management of treasury and operating costs apart from strengthening its robust collection mechanism. Commenting on the company’s performance, Mr Sanjay Chamria, Vice Chairman and Managing Director, Magma Fincorp Limited said, “The market conditions have improved drastically with the economy finally back on track. Aligned with the improvement in the industry’s automobile and vehicle sales, Magma too has been able to grow its disbursals in Q3 by 43% over Q1. We successfully increased share of our high yield products to achieve higher net interest margins and achieved NIM of 5.6% in Q3. A major highlight of our performance in the third quarter and year to date is our collections efficiency which touched new heights and is now setting new industry benchmark at an all time high of 99.20% in Q3 and 98.90 YTD (April- December 2009). “We now anticipate a strong conclusion in Q4 to make this a memorable year when we met market challenges and overcame them.”” added Mr Chamria. Magma Fincorp Limited (“Magma”) is a non-deposit taking non-banking finance company (NBFC), registered with the Reserve Bank of India (RBI) as an Asset Finance Company. The Company, having started operations over two decades back, is listed on the Bombay Stock Exchange Limited and the National Stock Exchange in India. Magma provides a bouquet of financial products including financing of Utility Vehicles & Cars, Commercial Vehicles, Construction Equipments, Tractors and SME Loans. Magma has a dedicated base of over 2.0 lac customers and has assets of approximately INR 9390 crores under management. The company has 151 branches in 20 states and 1 union territory and employs about 4400 people.
Magma has recently signed a joint venture with HDI Gerling, part of Talanx Group, Germany’s third largest insurance group to start a general insurance company in India. The new company will be head quartered in Kolkata. The new insurance company since has obtained Reserve Bank of India approval and is currently awaiting the Insurance regulator IRDA approval for commencement of operations.
