The Hindu Business Line : Mahindra Finance Q2 net up 8.4 pc

Mahindra Finance has reported an 8.4 per cent rise in net profit at Rs 30.32 crore (Rs 27.97 crore) for the second quarter of the current fiscal ended September 30, 2006.

Total income has moved up 37 per cent to Rs 196.52 crore from Rs 142.93 crore.

The company attributed its growth largely to its recent financial tie up with Maruti. It has been financing the sale of around 3,000 Maruti vehicles every month. Also, the company recently expanded its retail network to 380 branches from 315, enabling the company to fund sales of over 15,000 vehicles per month as against 9,000 vehicles last year.

Of the 15,000 vehicles, 65 per cent are M&M models, while the rest are non-M&M models.

With Mahindra & Mahindra's foray into the commercial vehicle segment, the finance company has been financing a low but steady volume of commercial vehicles as well. It has also conducted pilot projects on financing of two-wheelers with select M&M dealers who also sell two-wheelers.

Second-hand vehicles

The company's scheme to exchange second-hand vehicles for new ones has been doing well. The company, in turn, sells second-hand vehicles to prospective buyers and that number is placed at 2,000 units per month, said Mr Ramesh Iyer, Managing Director, Mahindra Finance.

Expansion in various segments has lifted staff costs to Rs 15.6 crore (Rs 9.98 crore) for the quarter under consideration. Other expenses include recruiting contract labour amounted to Rs 28.80 crore (Rs 18.72 crore).

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