Calcutta, May 31: City-based non-banking finance company Magma Fincorp today reported a 256 per cent growth in net profit at Rs 26.46 crore for the quarter ended March 31 compared with Rs 7.43 crore in the same period last year.
Disbursements jumped 102 per cent year-on-year to Rs 1,389 crore, reflecting a strong economic recovery, particularly in the commercial vehicle segment.
The market conditions have improved since August and it helped to increase our disbursals, particularly in the fourth quarter, managing director Sanjay Chamaria said.
However, we have been able to increase our profitability by reducing the cost-to-income ratio, increasing loan recovery efficiency and improving the share of high-yield products such as tractor and used commercial vehicle financing and lending to SMEs, he said.
Magma has seven different product lines and the share of high-yield products grew to 13 per cent in 2009-10 from 9 per cent a year ago.
The company has also been able to improve its loan recovery efficiency to 106.4 per cent in the January-March quarter. The recovery of some of its bad loans has led to the reduction in non-performing assets to 0.46 per cent from 0.54 per cent. The decline in the cost to income ratio to 29.6 per cent from 32.5 per cent a year ago has led to a 5.5 per cent rise in net interest margin.
For the full year, net profit grew 79 per cent to Rs 71.3 crore, while its disbursements increased 24 per cent to Rs 4,559 crore.