The Hindu Business Line : Magma Leasing net profit rises 37% to Rs 6.51 cr

MAGMA Leasing Ltd, an NBFC with 63 branches across the country, for the quarter ended September 30, 2005, has recorded a 37 per cent increase in profit after tax at Rs 6.51 crore against Rs 4.74 crore in the year-ago period.

The Q2 business disbursals of the company were up 27 per cent at Rs 379.25 crore (Rs 297.93 crore). Briefing newspersons here after the company's board meeting, Mr Sanjay Chamria, Managing Director, said the Q2 profit before tax has surged by 95 per cent to Rs 10.03 crore. Mr Chamria said disbursals for the half-year ended September 30, 2005 had touched Rs 725.30 crore, up 25 per cent from Rs 578.47 crore in H1 of 2004-05. Despite higher costs on account of operations, manpower and taxes, Magma has managed to improve its performance due to better utilisation of resources, he added. The company mainly finances commercial vehicles (CVs) and passenger cars, besides construction equipment. He said that though the industry had witnessed stagnation in CV and car sales in the first quarter, the first-half performance improved, riding on the back of the second quarter show. Mr Chamria said, "We have outgrown the industry in both products with the CV loans business increasing by 9 per cent and car loans by 44 per cent. We have also done well in construction equipment loans, registering a growth in excess of 35 per cent year-on-year."

The company, he pointed out, has added some 15,000 new customers during April-September 2005, taking the total to 70,000. He attributed the slump in Q1 to the introduction of VAT, Euro-111 norms and the diesel price hikes, affecting sales of both CVs and cars. Mr Chamria expected an increase in sales of vehicles in the second half owing to the positive GDP growth projections by the RBI.

Magma has opened six new offices mostly in the Central and Northern regions.

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