The Hindu Business Line : Magma Leasing Q1 net up 31 pc

Magma Leasing Ltd has recorded a 31 per cent increase in profit after tax at Rs 11 crore for the quarter ended June 30, 2006, against Rs 8.43 crore achieved during the same period last year. Total income for the quarter is placed at Rs 45.5 crore, up 39 per cent, from Rs 32.64 crore in the previous year.

Talking to Business Line here on Monday, after the company's AGM, Mr Sanjay Chamria, Managing Director, said total disbursements for the quarter were up 26 per cent at 43.65 crore (Rs 34.63 crore), indicating strong growth prospects for the current fiscal. He said "it has been a positive start for FY 2007.''

He attributed the improvement in PAT to new products added to the portfolio such as used commercial vehicles and strategic construction equipment financing, higher net interest margin (NIMs) and earnings on fee-based businesses. The company's total asset base has crossed Rs 3,452 crore as on June 30.

He said NIMs during the quarter improved to 3.65 per cent compared to 2.28 per cent in the corresponding quarter of 2004-05. Net NPAs were maintained at zero level given the prudent write-off norms followed by the company, he added.

The shareholders have approved the company's decision to raise Rs 121.82 crore through private placement in the UK-based Cambridge Place Investment Management (Rs 108.10 crore) and US-based Aeneas Evolution Portfolio (Rs 13.72 crore).

The investments by global players who operate structured funds will involve a combination of instruments such as equity shares, optionally convertible preference shares and non-convertible preference shares.

Members also approved the resolution pertaining to increase in authorised capital to Rs 200 crore from Rs 100 crore now.

Mr Chamria said post-allotment, the promoters' holding would come down to 47.6 per cent from 59 per cent. The paid-up equity would go up to Rs 17.8 crore (Rs 14.4 crore before allotment).

He said the key purpose of fund raising was to further improve the capital adequacy ratio and secure Magma's long-term capital requirements.

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