mathoot pro. rakha jatev

7/31/2019 Mathoot Pro. Rakha Jatev

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PREFACE

This project report is on the MARKETING STRATEGY OF MUTHOOT

FINANCE .

Theories can be read but the perform it in the real life is different experience will

together. Management courses are designed to produce future managers and unless

you have practical knowledge the theoretical knowledge is not implicated. Hence this

project is to give us the practical way of knowing how market behaves and reacts.

This is also in part fulfillment of BBA Degree.

RAKHA JATAV

BBA IVthSemester


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I declare that the project report titledMARKETING STRATEGY OF

MUTHOOT FINANCE. to prepare the marketing strategy and Advertisement is my

own work conducted under the supervision of Mr.Shailendra patel, Department of

Business Management Govt. Girls P.G. College of Excellent, Sagar. To the best of my

knowledge the report does not contain any work which has been submitted for the

award of any degree, anywhere.

Name : RAKHA JATAV

B.B.A. IVth

Semester


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The Project report titled" MARKETING STRATEGY OF MUTHOOT

FINANCE"has been prepared the marketing strategy and advertisement by Miss.

RAKHA JATAV student of B.B.A. IVthSemester under the guidance and supervision

ofMR.SHAILENDRA PATEL for the fulfillment of the Degree of B.B.A.

Signature of the

Supervisor

Signature of the Head

of the Department

Signature of the

Examiner


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INTRODUCTION

We are the largest gold financing company in India in terms of

loan portfolio, according to the 2010

update to the IMaCS Research &Analytics Industry Reports, Gold Loans

Market in India, 2009 (IMaCS

Industry Report, (2010 Update)). We

provide personal and business loans

secured by gold jewellery, or Gold

Loans, primarily to individuals who

possess gold jewellery but could not

access formal credit within a

reasonable time, or to whom credit

may not be available at all, to meet unanticipated or other short-

term liquidity requirements. According to the IMaCS Industry

Report (2010 update), as of March 31, 2010 our branch network

was the largest among gold loan NBFCs in India. Our Gold Loanportfolio as of September 30, 2011 comprised approximately 5.5

million loan accounts in India that we serviced through more than

3,274 branches across 20 states, the national capital territory of

Delhi and four union territories in India. As of September 30,

2011, we employed 21,543 persons in our operations. We are a

Systemically Important Non-deposit taking NBFC

headquartered in the southern Indian state of Kerala. Ouroperating history has evolved over a period of 72 years since M

George Muthoot (the father of our Promoters) founded a gold loan

business in 1939 under the heritage of a trading business

established by his father, Ninan Mathai Muthoot, in 1887.Since

our formation, we have broadened the scale and geographic scope


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of our retail lending operations so that, as of March 31, 2010, we

were Indias largest provider of Gold Loans. In the years ended

March 31, 2008, 2009, 2010, 2011 and in the period ended

September 30, 2011, revenues from our Gold Loan business

constituted 95.97%, 96.71%, 98.08%, 98.75% and 99.01%,respectively, of our total income. In addition to our Gold Loans

business, we provide money transfer services through our

branches as sub-agents of various registered money transfer

agencies, and recently have commenced providing collection

agency services. We also operate three windmills in the state of

Tamil Nadu. We issue secured non-convertible debentures called

Muthoot Gold Bonds on a private placement basis. Proceedsfrom our issuance of Muthoot Gold Bonds form a significant

source of funds for our Gold Loan business. We also rely on bank

loans and subordinated debt instruments as our sources of funds.

As per our audited financial statements as of September 30, 2011

we had ` 50,415 million in outstanding Muthoot Gold Bonds and `

122,152 million in other borrowings. We also raise capital byselling a portion of our loan receivables under bilateral

assignment agreements with various banks. We also raise capital

by issuing commercial paper and listed & credit rated non-

convertible debentures under private placement mode to various

institutional investors. Our customers are typically small

businessmen, vendors, traders, farmers and salaried individuals,

who for reasons of convenience, accessibility or necessity, avail ofour credit facilities by pledging their gold jewellery with us rather

than by taking loans from banks and other financial institutions.

We provide retail loan products, primarily comprising Gold Loans.

We also disburse other loans, including those secured by Muthoot

Gold Bonds.Our Gold Loans have a maximum 12 month term. As


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per our audited financial statements, our average disbursed Gold

Loan amount outstanding was ` 37,765 per loan account as of

September 30, 2011. For the period ended September 30, 2011,

our retail loan portfolio earned, on average, 1.82% per month, or

21.87% per annum. As per our audited financial statements, as ofMarch 31, 2008, 2009, 2010, 2011 and as of September 30, 2011,

our portfolio of outstanding gross Gold Loans under management

was ` 21,790.1 million, 33,000.7 million,` 73,417.3 million, `

157,280.7 million and 207,666.2 million, respectively, and

approximately 30.1 tons, 38.9 tons, 65.5 tons, 112.0 tons and 129.5

tons, respectively, of gold jewellery was held by us as security for

our Gold Loans. Gross non-performing assets ("NPAs") were at0.42%, 0.48%, 0.46%, 0.29% and 0.59% of our gross retail loan

portfolio under management as of March 31, 2008, 2009, 2010,

2011 and as of September 30, 2011 respectively.As per our audited

financial statements, in the years ended March 31, 2008, 2009,

2010 and 2011, our total income was ` 3,686.4 million, ` 6,204.0

million, ` 10,893.8 million, and ` 23,158.7 million, respectively,demonstrating an annual growth rate of 57.56%, 68.29%, 75.59%

and 112.59%, respectively. As per our audited financial

statements, in the six months ended September 30, 2011, our total

income was ` 20,245.4 million.As per our audited financial

statements in the years ended March 31, 2008, 2009, 2010 and

2011our profit after tax was ` 630.6 million, ` 978.7 million, `

2,285.2 million and ` 4,941.8 million, respectively, demonstratingan annual growth rate of 43.80%, 55.20%, 133.49% and 116.25%,

respectively. As per our audited financial statements, our profit

after tax in the six months ended September 30, 2011 was `

4,060.06 million.As per our audited financial statements as of

March 31, 2008, 2009, 2010, 2011 and September 30, 2011, our


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Union Territory of Pondicherry constituted 71% of our total Gold

Loan portfolio.We have a strong presence in under-served rural

and semi-urban markets. A large portion of the rural population

has limited access to credit either because of their inability to meet

the eligibility requirements of banks and financial institutionsbecause credit is not available in a timely manner, or at all. We

have positioned ourselves to provide loans targeted at this market.

We offer products with varying loan amounts, advance rates (per

gram of gold) and interest rates. The principal loan amounts we

disburse usually range from ` 2,000.0 to ` 200,000.0 while interest

rates on our Gold Loans usually range between 12.00% and

26.00% per annum.


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HISTORY

Muthoot Finance our Company was originally incorporated

as a private limited company on March 14,1997 with the name The Muthoot FinancePrivate Limited under the Companies Act.

Subsequently, by fresh certificate ofincorporation dated May 16, 2007, our namewas changed to Muthoot Finance Private

Limited. The Company was converted into a

public limited company on November 18, 2008 with the nameMuthoot Finance Limited and received a fresh certificate of

incorporation consequent upon change in status on December02, 2008 from the RoC. Merger with Muthoot EnterprisesPrivate Limited Our Company, along with MuthootEnterprises Private Limited, filed a composite scheme of

arrangement bearing C.P. Nos. 48 and 50 of 2004 under theCompanies Act before the High Court of Kerala (Scheme of

Amalgamation). The Scheme of Amalgamation was approved

by the board of directors of our Company through the boardresolution dated April 28, 2004. Pursuant to the approval ofthe Scheme of Amalgamation by the High Court of Kerala byan order dated January 31, 2005, Muthoot Enterprises PrivateLimited was merged with our Company, with effect fromMarch 22, 2005 and the High Court of Kerala had instructedall the parties to comply with the statutory and other legalrequirements to make the Scheme of Amalgamation effective.The company on March 22, 2005 filed a certified copy of theorder of the High Court of Kerala with the RoC.With the


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successful implementation of the Scheme of Amalgamation,the undertaking of Muthoot Enterprises Private Limited alongwith its assets and liabilities was transferred to and vested inour Company. Key events, milestones and achievements Year

2001 RBI license obtained to function as an NBFC. 2004.Obtained highest rating of F1 from Fitch Ratings for shortterm debt of Rs. 200 million. 2005 Retail loan and debenture

portfolio of the Company exceeds Rs. 500 million. Merger ofMuthoot Enterprises Private Limited with the Company 2006.F1 rating obtained from Fitch Ratings affirmed with anenhanced short term debt of Rs. 400 million. 2007 Retail loan

portfolio of the Company crosses Rs. 10 billion. RBI accordsstatus of Systemically Important ND-NBFC. Branch network ofthe Company crosses 500 branches. Net owned funds of theCompany crosses Rs. 1 billion. 2008 Net owned funds of theCompany crosses Rs. 2 billion. Retail loan and debenture

portfolio crosses Rs. 20 billion and Rs. 10 billion respectively.

F1 rating obtained from Fitch Ratings affirmed with anenhanced short term debt of Rs. 800 million. Overall creditlimits from lending banks crosses Rs. 5 billion. Conversion ofthe Company into a public limited company. Fresh RBI licenseobtained to function as an NBFC without accepting publicdeposits, consequent to change in name.. 2009 Retail loan anddebenture portfolio crosses Rs. 30 billion and Rs. 15 billionrespectively. Net owned funds of the Company crosses Rs. 3billion. Gross annual income crosses Rs. 5 billion. Overallcredit limits from lending banks crosses Rs. 10 billion. 2010.Retail loan and debenture portfolio crosses Rs. 50 billion andRs. 20 billion respectively. Net owned funds of the Companycrosses Rs. 4 billion. Overall credit limits from lending banks


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COMPANY PROFILE

Muthoot Finance, Indias largest gold loan company is the firstchoice of Indians who want to make their dream a reality. Maythe dream be to start their own business or to buy their ownhome, for over 124 years Muthoot Finance has helped almostevery Indians dream come true. Trusted by over 70000customers everyday, Muthoot Finance Gold Loan has servicesand products that fit the need of any customer, making it thequickest, most convenient and safest way to take a gold loan

Key features of Gold Loan: Loan disbursal in 5 minutesLoansstarts from 1,500 to1Crore Minimal documentation and credit

assessment requirementsHigh quality customer service in short

response timeEvaluation of gold ornaments takes place in house.

Safety of Gold Ornaments: All branches as equipped with Strong

Rooms for keeping safe custody of Gold Ornaments Gold Loan

available at over 3,000 Muthoot Finance branches across India0%

processing feesPre-payment option-without any penalty.GOLD LOAN SCHEMES:


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Gold Coins:Now invest your wealth in the ever rising power ofGold with the Muthoot Precious MetalsCorporation. 24 carat Pure Gold Coins: MuthootPrecious Metals Corporation presents Gold Coins

with 999% purity (24 Carat). Invest in safe, secureand profitable Gold Coins.

The Gold Coins hold many advantages: 999% pureFinanceschemes with easy monthlyinstallmentsAppreciating assetHigher return oninvestment with no risksAvailable indenominations such as 2g, 4g, 8g, 20g and 50g tosuit every pocketThe ideal gift for your near anddear ones.

Silver Coins:999% pure Silver CoinsOne of India's few financialplayers that deals in Silver CoinsAvailable in 50gm and 100gm Available at over3,000 MuthootFinance brances across India.


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7.Capital Adequacy- As at 31st March. 2011. the capital

adequacy of the company stood at 15.82% as against thestatutory requirement of 15%.

8.RBIGuidelines-Your Company has complied with all theapplicable regulations prescribed by the Reserve Bank of India

from time to time.9. Auditors- M/s Rangamani & Co., Chartered Accountants, theStatutory Auditor of the Company, hold office in accordance withthe provisions of the Act upto the conclusion of the forthcoming

Annual General Meeting and are eligible for re-appointment.

10.Directors- Responsibility Statement: As required under

the provisions contained in Section 217(2AA) of the CompaniesAct, 1956 (the Act), your Directors hereby confirm that:1. In the preparation of Annual Accounts for the financial year2010-11, the applicable Accounting Standards have been

followed and there are no material departures.2. They have selected such accounting policies and appliedthem consistently and made judgments and estimates that arereasonable and prudent so as to give a true and fair view of thestate of affairs of the Company at the end of the financial yearand of the profit of the Company for financial year.

3. They have taken proper and sufficient care to the best oftheir knowledge and ability for the maintenance of adequateaccounting records in accordance with the provisions of the Act.They confirm that there are adequate systems and controls forsafeguarding the assets of the Company and for preventing anddetecting frauds and other irregularities.


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4. The annual accounts have been prepared on a going concernbasis.

11.Corporate Governance Report and Management

Discussion and Analysis Statement-Your Company hascomplied with the Corporate Governance norms as stipulatedunder the Listing Agreement entered into with the StockExchanges. Detailed reports on Corporate Governance andManagement Discussion and Analysis are annexed to this Report.Conservation of energy, technology absorption, foreign exchangeearnings and outgo Since the Company does not carry onmanufacturing activities disclosure requirements underCompanies[Disclosure of Particulars in the Report of Board of Directors)Rules, 1956 in this connection are not applicable. However, yourCompany, being a responsible corporate citizen, has been takingvarious measures for reducing the energy consumption.


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The main objective of project is to prepare the marketing

strategy and Advertising of MUTHOOT FINANCE are as under :-

To know availability and durability of the product andservices of muthoot finance .

To know whether products are feasible. To know about best quality of muthoot finance . To know about very good services of finance .


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As said a basic research was conducted at the company to

enables the company to assess how far the customers are

satisfied with product and services of muthoot finance

.During the course of the study the following limitations

were observed:

(a) The method will be unsuitable if the number of persons to besurveyed is very less as it will be difficult to draw logical

conclusions regarding the satisfaction level of customers.

(b) Interpretation of data may very from individual dependingon the individual understanding the product features and

services of the company .

(c) The method lacks flexibility.In case of inadequate onincomplete information the result may deviate.

It is very difficult to check the accuracy of the informationprovided.

(d) Since all the products and services are not widely used by allthe customers it is difficult to draw realistic conclusions

based on the survey.


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SUGGESTIONS

The following suggestions are offered to the Muthoot finance :-

1. As the muthoot finance thus company should launcheffective promotional.

2. Wide advertisement showing utility of their product andfeatures of their product should be made.

3. Company may offer gifts scheme from time to time so thathe product may attract the masses.

4. The company should lower the price5. The company should come up with attractive advertising

plants.

6. The company should improve its distribution network.7. The company should also think and implement some public

relation programme.


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1. Customer's priority is on the price, mileage, and look whilepurhasing muthoot finance . They are not much affected y

promotional programs.

2. Dealers expect some promotional schemes/ offers from thecompany.

3. There are many promotional offers available to the customerslike:

4. Company hired many cricketers and actors for promoting the

product.


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BIBLIOGRAPHY

Marketing Management by Sir Kotler PhilipMarketing Research by Sir Sharma D.D. Websites :

oWww muthoot finance .comowww.google. Como www.marketing stratergy of muthoot finance .com


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ADVERTISING OF MUTHOOT FINANCE
http://www.google.co.in/imgres?imgurl=http://bhartiads.co.in/wp-content/uploads/2011/12/Muthoot-Finance-Indias-Largest-Gold-Loan-Company-Double-Your-Investment-Also-Offers-Fixed-Interest-For-3-5-Years-389x649.png&imgrefurl=http://bhartiads.co.in/ads/Finance&usg=__ynnHG_5SAmbCEI4PdzqmoYflLng=&h=649&w=389&sz=62&hl=en&start=19&zoom=1&tbnid=yM11WyuiqLg_jM:&tbnh=137&tbnw=82&ei=Q5dpT6rCHcaGrAfi-fiSCA&prev=/search?q=introduction+of+muthoot+finance&hl=en&sa=X&gbv=1&prmdo=1&tbm=isch&prmd=imvns&itbs=1


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