Mahindra Finance to raise up to Rs 570 cr in mid-Jan

Mahindra & Mahindra Financial Services Ltd. | Finance - NBFC | BFSI | BSE: 532720 | NSE: M&MFIN

07 Dec 2010 Evaluate

Mahindra & Mahindra Financial Services (Mahindra Finance) plans to raise up to Rs 570 crore through institutional placement of equities by mid-January to meet the high level of demand coming in mostly from rural India and fuel the expansion plan over the next two-years and increase our authorised capital to Rs 190 crore from the present Rs 160 crore.The company has achieved a healthy growth of over 60 per cent in the first half of this fiscal at Rs 12,500-crore and to sustain this growth level, it plans to expand the base, mainly in rural India. Rural India is growing at 30-35 per cent and there is a lot of cash. Tractors, two-wheelers and small cars sales are doing extremely well. The company's AUM has been growing at 25 per cent YoY for the last five-years. While tractors contributed to 20 per cent of the company's revenues, 80 per cent came in from automobiles of which 40 per cent emanated from small cars.

On its retail expansion,the company would open 75 branches this fiscal, mostly in Tier II and III cities. Presently, it has around 506 sales offices in the country. The company is presently running a pilot programme in Kerala for gold financing and plans to launch it by end-this fiscal. The company has in the three months of the pilot done a business of about Rs 20-crore. The company also plans to add a million new customers every three-years. Presently, it has a customer base of around 1-million.crack crack