MAGMA FINCORP LIMITED

Magma Fincorp Limited is a Public incorporated on 18 December 1978. It is classified as Non-

govt company and is registered at Registrar of Companies, Kolkata. Its authorized share capital
is Rs. 8,360,000,000 and its paid up capital is Rs. 538,720,450. It is inolved in Wholesale of
machinery, equipment and supplies

Magma Fincorp Limited's Annual General Meeting (AGM) was last held on 01 August 2019 and
as per records from Ministry of Corporate Affairs (MCA), its balance sheet was last filed on 31
March 2019.

Directors of Magma Fincorp Limited are Vegulaparanan Kasi Viswanathan, Mayank Poddar,
Sanjay Chamria, Sunil Rewachand Chandiramani, Vijayalakshmi Rajaram Iyer, Narayan
Keelveedhi Seshadri.

PRODUCTS OF MAGMA FINCORP LIMITED

 Construction Equipment Loan

 Car Loans
 Housing Finance
 Tractor Loans
 SME Loans
 Commercial Vehicle Loans
 Auto Lease
 Insurance

SWOT ANALYSIS
Strengths of Magma Fincorp Limited
 DIVERSIFIED PRODUCT PORTFOLIO: Magma has a portfolio of nine products across asset
finance, business finance and mortgage finance. The maximum exposure in a single product is
capped at 30% thus ensuring that product specific risks are minimized. This diversified mix also
allows Magma to calibrate its growth strategy with market realities and switch focus across
products whenever required.
  UNDERBANKED CUSTOMER BASE: Magma has espoused the policy of financial inclusion by
focusing on customers who are left out of the banking network. Magma prefers to finance
customers who do not have adequate documentation, credit history and hence are perceived as a
high-risk category by the banking channels. Magma believes that credit worthiness can be
evaluated by employing innovative methods that take into account the subjective knowledge
gleaned from customer visits and background checks.

 GEOGRAPHICAL DIVERSIFICATION: Magma has a pan India presence spread across 22

states and union territories, which account for more than 90% of India’s population. Magma has
ensured that the loan book exposure in a single state is limited to around 10% thus reducing the
impact of local and regional risks eg. Drought, floods, political instability.

 CONSERVATIVE ACCOUNTING POLICIES: Magma follows some of the most conservative

accounting policies in the NBFC industry. Magma is one of the select few NBFCs to follow a 120
dpd+ NPA recognition policy against the RBI requirement of 180 dpd+. Besides this, the
company has opted for higher than mandated provisioning norms on its NPA and provided 30 bps
standard assets provisioning. These steps have resulted in Magma creating a pool of significantly
higher provisions than is required.

 EFFICIENT LIABILITY MANAGEMENT: Magma is one of the few NBFCs which has a truly
diversified liability profile encompassing bank lines, capital markets and securitization
transactions. Magma has been able to make a successful transition from a profile with a high
share of securitization to a profile evenly spread across all three funding channels. This allows
Magma the flexibility to balance the channel wide exposure to optimize the benefits of liquidity,
cost of funds and maturity

Threats of Magma Fincorp Limited

 People are less aware about the institution

 Economic Changes
 Less branches in Kerala
 Less penetration in some regions of the country
 Low publicity causes lack of awareness amongst investors

Opportunities of Magma Fincorp Limited

 Growing rural market through customized and cheaper services
 Investment by earning urban youth
Threats of Magma Fincorp Limited
 Stringent Economic measures by Government and RBI.
 Entry of foreign finance firm in Indian Market.

Performance Analysis
Automobile Sector

All India sales of new commercial vehicles (CV) continue to grow it grew by 17.55% during FY 2018-19 as compared

to 19.94% in FY 2017-18.The sale of new passenger vehicle recorded growth of 2.7% during FY 2018-19 against

7.9% growth recorded in FY 2017-18.

SME Mentor

It has scaled significantly over the years on the back of increasing awareness digital advancement and better

opportunities that have encouraged many entrepreneurs.

Submitted By,

ARUN P PRASAD
S4
MIIM