A project report on does maruti finance helps mul increase its sales

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A project report on does maruti finance helps mul increase its sales

  1. 1. Does Maruti Finance Helps MUL increase its sales Maruti Finance INTRODCTION TO Indian Auto IndustryThe automobile industry in India offers significant employment opportunities. Theautomobile industry including component industry employs 0.45 million people directly andaround 10 million people indirectly.The auto industry recorded a turnover of US$ 10 billion while the auto-component industryrecorded a turnover of US$ 2.7 billion in 1999-2000.Many international auto majors entered the country post liberalisation in 1991.India’s largest car-maker Maruti Udyog Ltd (MUL) was recently privatised with Suzuki MotorCorporation moving into the driving seat after acquiring a majority stake and managementcontrol in the Maruti Suzuki joint venture in early 2002.Policy InitiativesAuto policy announced by the government in 2002 has opened the automobile sector to 100per cent foreign direct investment and removed the minimum capital investment norm forfresh entrants. This will benefit manufacturers who are planning to enter the Indian market,particularly in the burgeoning motorcycle market.The new policy has taken into account the need to address emerging problems and make theauto sector WTO compatible.The policy is also in favour of providing excise duty concessions to small cars, multi-utilityvehicles and low emission vehicles. It envisages India becoming a major hub for themanufacture of small cars and a global supplier of components. The policy also includesincentives to facilitate R&D.Import tariffs are to be fixed in a manner so as to promote manufacturing in India, as opposedto mere assembly, without giving undue protection to domestic industry. While ensuring abalanced transition towards open trade, the automotive tariff structure will be reviewedperiodically to prevent India from becoming a ‘dumping ground’ for international rejects.Babasabpatilfreepptmba.com Page 1
  2. 2. Does Maruti Finance Helps MUL increase its sales Maruti FinanceOpportunitiesIndia enjoys a distinct cost advantage with respect to auto-ancillary manufacturingcapabilities. While developed nations’ labour cost component is 30-35 per cent of sales, Indianlabour cost is only around 8-9 per cent of sales.The number of vehicles manufactured in India has risen from 3 million units annually in 1999to 5 million units in 2002. This has also led to an increase in domestic demand for automotivecomponents.Other global players in component manufacturingJapanese and British component manufacturers are already operating JVs in India. Americancompanies, which have or are planning to set up plants in India, include Delphi (anautomotive components division of General Motors, USA), Delco Electronics, Textron andMagna International of Canada.Auto majors such as DaimlerChrysler, Volvo, Renault, Toyota and Honda are planning tooutsource their requirements from India.Automotive components manufactured in India are of top quality and used as originalcomponents for vehicles made by top international companies such as General Motors,Mercedes and IVECO among othersThe industry encompasses commercial vehicles, multi-utility vehicles, passenger cars, twowheelers, three wheelers, tractors and auto components. There are in place 15 manufacturersof cars and multi utility vehicles, 9 of commercial vehicles, 14 of Two/Three Wheelers and10 of Tractors besides 5 of engines. With an investment of Rs.50,000 crores, the turnover wasRs. 59,500 crores in Automotive Sector during 1999-2000. It employs 4,50,000 peopledirectly and 100,00,000 people indirectly and is now inhabited by global majors in keencontention.India manufactures about 38,00,000 2-wheelers, 5,70,000-passenger cars, 1,25,000 MultiUtility Vehicles, 1,70,000 Commercial Vehicles and 2,60,000 tractors annually. India rankssecond in the production of two wheelers and fifth in commercial vehicles.Babasabpatilfreepptmba.com Page 2
  3. 3. Does Maruti Finance Helps MUL increase its sales Maruti FinanceIndia’s automotive component industry manufactures the entire range of parts required by thedomestic automobile industry and currently employs about 250,000 persons. Auto componentmanufacturers supply to two kinds of buyers – original equipment manufacturers (OEM) andthe replacement market. The replacement market is characterised by the presence of severalsmall-scale suppliers who score over the organised players in terms of excise duty exemptionsand lower overheads. The demand from the OEM market, on the other hand, is dependent onthe demand for new vehicles.There has been a slowdown in the automobile sector in the past two years. However, thecomponent industry maintained a low but positive growth rate mainly due to its exportperformance. Over the years, the component industry has maintained a 10% - 12% share ofexports in the total production.Roads occupy an eminent position in transportation as they, as per the present estimate, carrynearly 65% of freight and 87% of passenger traffic. Although, India has 3.3 millionkilometers of road network, which is the second largest in the world, the Indian highways aregetting overpopulated. Traffic management and road sense also need attention.Improving Road InfrastructureTraffic on roads is growing at a rate of 7 to 10% per annum while the vehicle populationgrowth for the past few years is of the order of 12% per annum. Poor road infrastructure andtraffic congestion can be a bottleneck in the growth of vehicle industry. A balanced andcoordinated approach will be undertaken for proper maintenance, upgradation anddevelopment of roads by encouraging private sector participation besides public investmentand incorporating latest technologies and management practices to take care of increase invehicular traffic.For the convenience of traveling public the Government shall also promote multi-modaltransportation and the implementation of mass rapid transport systems.Incentive for Research and DevelopmentBabasabpatilfreepptmba.com Page 3
  4. 4. Does Maruti Finance Helps MUL increase its sales Maruti FinanceThe Government shall promote Research & Development in automotive industry bystrengthening the efforts of industry in this direction by providing suitable fiscal and financialincentives.The current policy allows Weighted Tax Deduction under I.T. Act, 1961 for sponsoredresearch and in-house R&D expenditure. This will be improved further for research anddevelopment activities of vehicle and component manufacturers from the current level of125%.In addition, Vehicle manufacturers will also be considered for a rebate on the applicableexcise duty for every 1% of the gross turnover of the company expended during the year onResearch and Development carried either in-house under a distinct dedicated entity, faculty ordivision within the company assessed as competent and qualified for the purpose or in anyother R&D institution in the country. This would include R & D leading to adoption of lowemission technologies and energy saving devices.Government will encourage setting up of independent auto design firms by providing themtax breaks, concessional duty on plant/equipment imports and granting automatic approval.Allocations to automotive cess fund created for R&D of automotive industry shall beincreased and the scope of activities covered under it enlargedBabasabpatilfreepptmba.com Page 4
  5. 5. Does Maruti Finance Helps MUL increase its sales Maruti FinanceFINANCE COMPANIES – THE PRESENT SCENARIORapidly falling interest rates have made loans affordable to more people, which means theresstill plenty of room left for growth. Disbursements are expected to increase at an annualized34% over FY2003-FY2007,taking outstanding retail loans to $130bn by FY2007. Thistranslates to a growth in outstanding loans from the current $36bn to $130bn, which wouldrepresent 33% of bank credit and 18% of GDP in FY2007. The market penetration at thislevel would still leave ample room for growth. The boom in financing would spuran increasein spends on consumer durables such as two-wheelers and cars. Sales growth in two-wheelerswould accelerate from an annualized 10-11% over the past ten years, to 15.6% overFY2003-2007; Car sales, which have grown at an annualized 11% over the past three years,would rise at an even faster 20%.Retail loans would form a third of banks asset books in FY2007, and add Rs130bn to theirearnings over the next three years.Fuelled by the free fall in interest rates and intense competition, especially from state-ownedbanks, the availability of finance has expanded rapidly, and EMIs have fallen more steeply,than was expected.Consequently, the target population for financing has expanded by 18-20% for assets likecars, twowheelers and mortgages. The following exhibit shows growth of consumer financeover the years. The growth has been on a very high base, fuelled by the rapid fall in interestrates and the aggressive entry of many banks. The market would remain under penetratedeven at high projected growth in future.Babasabpatilfreepptmba.com Page 5
  6. 6. Does Maruti Finance Helps MUL increase its sales Maruti FinanceFalling Interest RatesFalling interest rates, coupled with increasing loan durations, have substantially reduced theEMIs on retail loans, thereby making them affordable to more people than ever before. Thetable below shows the fall in Interest Rates.Year to 31 March 1999 1999 2002 Current ratesCarsBasic IRR (%) 18 13.5 9.5Less manufacturer subventions (%) 1-1.5 1-1.5 1.5Dealer (%) 1.5 1.5DSA (%) 1 1Net rate to customer (%) 16.5-17 9.5-10 5.5Impact of Consumer Finance Growth onPassenger Cars and Two-WheelersSales of passenger cars increased by 26.5% yoy in the first half of this fiscal, owing to thelowering of excise duties in the general budget. The two-wheeler industry grew by 8.9%during this period, much slower than the heady high-teens growth over the past two years, asthe agricultural slowdown last year hit rural incomes. Two-Wheeler sales are expected toincrease at a compounded 15.6% over FY2003-FY2007 Car sales would rise at an even faster20% over the same period.Consumer PreferencesIndian consumers identify ease and speed of the loan application and approval process, as well asflexibility of evaluation procedures, as the key drivers of financing satisfaction.Consumer Financing Satisfaction Performance is measured by four factors: • Application process (44 percent); • Approval and documentation (22 percent); • Finance advisor (18 percent); and • Loan value (16 percent).Customers who obtained their loans from a nationalized bank are relatively more satisfied thanthose choosing a non-banking finance company (NBFC) or a foreign bank.Babasabpatilfreepptmba.com Page 6
  7. 7. Does Maruti Finance Helps MUL increase its sales Maruti FinanceLow interest rates and the reputation of the finance company are among the key reasons forcustomers who opted either for an NBFC or a foreign bank. In comparison, past experience andpersonalized service are the main reasons indicated by those opting for a nationalized bank.Furthermore, more than 50 percent of NBFC and foreign bank customers obtained theirfinancing at an automobile dealer or through a direct selling agent of the finance provider. Incontrast, more than 90 percent of nationalized bank customers obtained their financing directlythrough the bank.The car finance market has reached a new level of maturity, so much so that the car-maker, theautomobile dealer and the financier now work together to provide better features and fundingoptions for the buyer. Depending on the manufacturer, tenure of the loan and credit history of thecar buyer, interest rates, on a reducing balance basis, now hover in the 10-13.5 per cent range fornew cars compared to 13-16.5 per cent till early last year. There is an increased preference forfinancing car purchases through loans.Babasabpatilfreepptmba.com Page 7
  8. 8. Does Maruti Finance Helps MUL increase its sales Maruti FinanceMaruti Udyog Limited (MUL) was established in Feb 1981 through an Act of Parliament, tomeet the growing demand of a personal mode of transport caused by the lack of an efficientpublic transport system.Suzuki Motor Company was chosen from seven prospective partners worldwide. This wasdue not only to their undisputed leadership in small cars but also to their commitment toactively bring to MUL contemporary technology and Japanese management practices (whichhad catapulted Japan over USA to the status of the top auto manufacturing country in theworld).A licence and a Joint Venture agreement was signed between Govt of India and Suzuki MotorCompany (now Suzuki Motor Corporation of Japan) in Oct 1982.The objectives of MUL then were:Modernization of the Indian Automobile Industry.Production of fuel-efficient vehicles to conserve scarce resources.Production of large number of motor vehicles which was necessary for economic growthVision—“The Leader in The Automobile Industry, Creating Customer Delight andShareholders Wealth; A pride of India.”Core valuesCustomerObsessionFast,Flexible and First MoverInovation and CreativityNetworking and PartnershipOpenness and LearningCOMPANY BACKGROUNDBabasabpatilfreepptmba.com Page 8
  9. 9. Does Maruti Finance Helps MUL increase its sales Maruti FinanceMaruti collaborated with Suzuki of Japan to produce cars in 1983. At this time, the Indian carmarket had stagnated at a volume of 30,000 to 40,000 cars for the decade ending 1983. WithMUL’s entry, the passenger car market saw a spurt in demand.The sector registered 18.6% CAGR growth in sales during 1981-90.The company reached atotal production of one million vehicles in March 1994, becoming the first Indian Company tocross this milestone. It crossed the two million mark in 1997. In 2001, it launched newbusinesses – ‘True value’, ‘Maruti finance’,‘Maruti Insurance’ and ‘N2N’. In 2003, the company listed on BSE & NSE after its publicissue.Business profileMUL is the leading automobile company in the passenger car segment with over 50% marketshare in FY04. It has a presence across many segments in automobiles. It is the leader in themini and the compact segment with its brands like ‘800’, ‘Zen’,‘Alto’, ‘Wagon R’. It also hasa presence in the mid-size segment with its ‘Esteem’and ‘Baleno’ brands and the ‘Omni’,‘Vitara’, ‘Versa’ models.Industry scenarioThe passenger vehicles industry comprises passenger cars, utility vehicles (UV) and multi-purpose vehicles (MPV’s). The fortunes of the auto sector are strongly correlated to macro-economic parameters and the performance of the industrial sector. In India, around 80% of allnew cars are financed. The increased availability of finance at low rates and strong GDPgrowth translated in a healthy growth for the industry.Babasabpatilfreepptmba.com Page 9
  10. 10. Does Maruti Finance Helps MUL increase its sales Maruti FinancePassenger car sales account for over 77% of total passenger vehicle market andUV’s account for the balance. Infact, UV’s have a higher share than what they did in theearlier years. It is still lower compared to some of the developed countries. In USA forinstance, UV’s account for 50% of the total Passenger vehicles market and in Indonesia theyaccount for 80% of the market.Length based classification (introduced by SIAM in April 2002):Passenger carsSegment A1 (mini) – cars having a length of up to 3,400mmSegment A2 (compact) – cars having a length of 3,401-4,000mmSegment A3 (mid-size) – cars having a length of 4,001-4,500mmSegment A4 (executive) – cars having a length of 4,501-4,700mmSegment A5 (premium) – cars having a length of 4,701-5,000mmSegment A6 (Luxury) – cars having a length of more than 5,000mm SWIFT A2 Mid-size BBabasabpatilfreepptmba.com Page 10
  11. 11. Does Maruti Finance Helps MUL increase its sales Maruti FinanceBabasabpatilfreepptmba.com Page 11
  12. 12. Does Maruti Finance Helps MUL increase its sales Maruti FinanceIn FY04, vehicle sales contributed for 94.6% of the gross sales and the balance 5.4% wascontributed by sales of spare parts, dies and moulds and components. The company registeredsales volumes of 472,122 units including exports in FY04. Net sales increased by 31.3% toRs93.7bn in FY04 from Rs71.4bn in FY03. Income from services stood at Rs278mn in FY04from Rs136mn in FY03, a rise of 104%. Other income primarily included returns on treasuryoperations, scrap sales, sales tax benefits and provision write back. It increased by 36.6% toRs3.8bn in FY04.EXPORTSMUL exported 51,175 units in FY04, a growth of 59% yoy. Its FOB value is Rs9.4bn inFY04 compared to Rs6.2bn in FY03, registering a 51.7% rise yoy. This growth as mainly dueto ‘Maruti 800’ which grew 56.8%. The A2 category registered a 60.5% growth. The Alto andthe Zen have done well for the company. The company registered good growth in Algeria,Belgium, Bhutan, Chile, Denmark, Germany, Hungary, Nepal, Sri Lanka and UK.Raw material costsSteel sheets, castings, forgings, alloy steels, steel tubes, saw steep rises in prices, which addedto the raw material costs of the company in FY04. Consolidated buying of steel and long termcontracts helped counter this problem to some extent.Even under such a scenario where raw material prices were rising, the company saw its costof raw material go down by 4.8 percentage points to 74.5% of net sales in FY04 due to itsoperating efficiencies. The company enjoyed a royalty waiver on some of its models fromSuzuki, and paid 10% less on components sourced from Suzuki, which helped reduce rawmaterial costs further. Operating profit margins (OPM) for the company improved to 10% inFY04 from 5.3% in FY03.Babasabpatilfreepptmba.com Page 12
  13. 13. Does Maruti Finance Helps MUL increase its sales Maruti FinanceVoluntary Retirement Scheme (VRS)The company has 3,334 employees as on March 31, 2004. It offered VRS to its employees inFY04 and 1,251 employees accepted the same. Rs1.2bn were accounted in the incomestatement to VRS in FY04. This was additional to the VRS offer in FY02, which wasaccepted by 1,050 employees.Initiatives takenVendor rationalization was done and number of vendors was reduced to 220 in FY04 fromover 350 two years prior to FY04. This helped enhance the supply chain efficiencies.MUL’s tie-up with SBI and its associate banks enabled it to reach smaller towns and citieswhere financing for purchase of vehicles was provided. Largely driven by this initiative, thecompany witnessed a 17% growth in its ‘800’ sales. The ‘Alto’ too, with its reduced pricessaw a 130% growth, the highest by any car in the year. MUL has 142 outlets covering over100 cities.The company, realizing that presence across segments is a key factor, launched the ‘GrandVitara’ a top-end SUV for the Indian market.It extended its ‘true value’ scheme and now accepts old cars of any manufacturer for a newMUL car.R&DThe objective of R&D by MUL was two-fold. One was to reduce product costs and thesecond is to become the regional R&D hub for Suzuki operations. The R&D spend for FY04stood at Rs390mn which is 0.35% of total turnover.R&D operations include, face lifts and body changes – styling, clay modeling, computeraided design, proto-type making, dies designing and so on. In FY04, the company introducednew Zen due to its R&D efforts.No capacity constraintMUL has three fully integrated facilities with a combined production capacity of 500,000units pa. However, the company produced around 1.4lac cars in Q4 FY04 without a thirdshift. Annualizing this figure makes it 5.6lac cars annually, which is higher than the 4.7laccars produced by MUL in FY04. Therefore, MUL will not be constrained by capacity in thenear future.Babasabpatilfreepptmba.com Page 13
  14. 14. Does Maruti Finance Helps MUL increase its sales Maruti FinanceMUL also reduced the number of hours required to produce a vehicle. From a high of 100hours in FY01 to 46.1 hours in FY04, it has come a long way in improving its productivityand efficiency.DepreciationMUL revised the estimated life of dies and jigs from a uniform eight years to periods rangingfrom 29 months to five years depending on the model. This was done wef April 1, 2003 basedon technical evaluation. This resulted in higher depreciation to Rs4,949mn in FY04 fromRs3,221mn in FY03.Investments worth Rs15.7bn were made during FY04. The major chunk of the investmentsare in debt mutual funds that account for 88.4% of the investment portfolio in FY04compared to bank fixed deposits which accounted for 98% of the total investments in FY03.Investment in bank fixed deposits is included under cash &bank balances in the annual report.Working capital managementThe company follows just-in-time (JIT) inventory principles. The net working capital of thecompany fell 62.7% yoy in FY04 to Rs4.9bn. This was mainly due to a fall in the debtor daysto 26.8 days from 34.3 days in the previous year. Inventory holding days declined to 17.1days in FY04 from 24.9 days in FY03.Approximately 70% of MUL’s components are outsourced. The creditor days reduced too to47.3 days from 58.1 days in the previous years. The company states that it does not desire todelay payments to component manufacturers and therefore has not stressed on increasingaverage payable period.Babasabpatilfreepptmba.com Page 14
  15. 15. Does Maruti Finance Helps MUL increase its sales Maruti FinanceDue to high sales growth and improved efficiency in operations caused the EPS to more thantriple to Rs18.8 in FY04 from Rs5.1 in FY03. The debt to equity ratio declined to 0.09 inFY04 from 0.15 in FY03. This shows that RONW increased with lower level of risks. Cashflow from operating activities increased by 32% yoy to Rs10.5bn in FY04.Babasabpatilfreepptmba.com Page 15
  16. 16. Does Maruti Finance Helps MUL increase its sales Maruti FinanceOutlook and future strategiesRobust economic growth, favourable regulatory framework, affordable finance andimprovements in infrastructure favor growth of the passenger vehicles segment. The lowpenetration levels at 7 per thousand and rising income levels will augur well for the autoindustry. However, rising oil prices and input raw material costs remains a concern.MUL expects the compact cars, which currently constitute around 80% of the market, to bethe engine of growth in the future.About 18% of cars sold in India run on diesel. MUL does not have a presence in this segment.It is therefore, setting up a capacity to offer diesel cars. It will be investing Rs3,500mn on thisplant that will be operational by 2006.CHALLENGES Wafer thin margins for financiers. Intense competition for the market share. Financiers exiting from the car loan sector Standard Chartered , ABN Amro exited from Maruti Finance. ICICI and HDFC reached to share of 80% in Maruti FinanceBabasabpatilfreepptmba.com Page 16
  17. 17. Does Maruti Finance Helps MUL increase its sales Maruti FinanceWe have introduced the superior 16 * 4 Hypertech engines across the entire Maruti Suzukirange. This new technology harnesses the power of a brainy 16-bit computer to a fuel-efficient 4-valve engine to create optimum engine delivery. This means every Maruti Suzukiowner gets the ideal combination of power and performance from his car.Our other innovation has been the introduction of Electronic Power Steering (EPS) in selectmodels. This results in better and greater maneuverability. In other words, our cars havebecome even more pleasurable to drive.]Spread over a sprawling 297 acres with 3 fully-integrated production facilities, the MarutiUdyog Plant has already rolled out over 4.3 million vehicles. In fact, on an average, twovehicles roll out of the factory every minute. And it takes on an average, just 14 hours tomake a car. More importantly, with an incredible range of 11 models available in 50 variants,theres a Maruti Suzuki made here to fit every car-buyers budget. And dream.MILESTONES2005 Launch of Swift The fiftieth lakh car rolls out in April, 2005 Growth in overall sales by 15.8%2004 New (non A/C) variant of Alto Alto becomes Indias new best selling car LPG variant of Omni Cargo Versa 5-seater, a t Baleno LXi, a new variant Maruti closed the financial year 2003-04 with an annual sale of 472122 units, the highest ever since the company began operations 20 years agoBabasabpatilfreepptmba.com Page 17
  18. 18. Does Maruti Finance Helps MUL increase its sales Maruti Finance2003 New Suzuki Grand Vitara XL-7 Redesigned and all-new Zen New upgraded WagonR Enters into partnership with State Bank of India Production of 4 millionth vehicle. Listed on BSE and NSE after a public issue oversubscribed 10 times2002 WagonR Pride Esteem Diesel. All other variants upgraded Maruti Insurance. Two new subsidiaries started: Maruti Insurance Distributor Services and Maruti Insurance Brokers Limited Alto Spin LXi, with electronic power steering Special edition of Maruti 800, India’s first colour-coordinated car Maruti True value in Mumbai Maruti Finance in Mumbai with 10 finance companies Suzuki Motor Corporation (SMC) increases its stake in Maruti to 54.2 percent2001 Zen LXi Maruti True Value launched in Bangalore and Delhi Maruti Versa, India’s first luxury MPV Alto Spin LXi, with electronic power steering Alto Vxi Customer information centers launched in Hyderabad, Bangalore and Chennai Launch of versa2000 First car company in India to launch a Call Center New Alto Altura, a luxury estate carBabasabpatilfreepptmba.com Page 18
  19. 19. Does Maruti Finance Helps MUL increase its sales Maruti Finance IDTR (Institute of Driving Training and Research) launched jointly with the Delhi government to promote safe driving habit1999 Maruti 800 EX ( 796cc, hatchback car) Zen LX (993cc, hatchback car) Zen VXi (993cc, hatchback car with power steering Omni XL ( 796cc, MUV, high roof) Baleno (1600cc, 3 Box Car) Wagon R1998 Maruti launches website as part of CRM initiatives Zen D (1527 cc diesel, hatchback car) Zen VX & Zen VX Automatic New (Omni & Omni E) (796cc, MUV) Launch of website as part of CRM initiatives1997 Esteem (1299cc, 3 box car) LX, VX and AX New Maruti 800 (796cc,hatchback Car) Standard and Deluxe Produced the 2 millionth vehicle since the commencement of production1996 Gypsy (E) (970cc, 4WD 8 seater) Omni (E) (796cc, MUV, 8 seater) Gypsy King (1298cc, 4WD, off road vehicle) Zen Automatic (993cc, hatchback car) Esteem 1.3L (1298 cc, 3 box Car)AX Launch of 24-hour emergency on-road vehicle service1995 Esteem 1.3L (1298 cc, 3 box car)VX With the launch of second plant, installed capacity reached 200,000 unitsBabasabpatilfreepptmba.com Page 19
  20. 20. Does Maruti Finance Helps MUL increase its sales Maruti Finance1994 Esteem1.3L (1298cc, 3 box car)LX Produced the 1 millionth vehicle since the commencement of production1993 Zen(993cc, hatchback Car), which was later exported in Europe and elsewhere as the Alto1992 SMC increases its stake in Maruti to 50 percent1991 Reaches cumulative indigenisation of 65 percent for all vehicles produced1990 Maruti 1000(970cc, 3 box), India’s first contemporary sedan1988 Installed capacity increased to 100,000 units1987 Exported first lot of 500 cars to Hungar1986 Maruti 800 ( New Model-796cc, hatchback Car) Produced 100,000 vehicles (cumulative production1985 Launch of Maruti Gypsy (970cc, 4WD off-road vehicle1984 Omni, a 796cc MUVBabasabpatilfreepptmba.com Page 20
  21. 21. Does Maruti Finance Helps MUL increase its sales Maruti Finance Installed capacity reached 40,000 units1983 Maruti 800, a 796 cc hatchback, India’s first affordable car. Production was started under JVA1982 License and JV agreement signed between Maruti Udyog Ltd. and SMC of Japan1981 Maruti Udyog Ltd was incorporated under the provisions of the Indian Companies Act, 1956AWARDS2005 Maruti Suzuki was No. 1 in Customer atisfaction, No. 1 in Sales Satisfaction No.1 in Product Quality (Esteem and Alto) and No. 1 in Product Appeal (Esteem and Wagon R) by JD Power2004 No. 1 in Total Customer Satisfaction (Maruti 800, Zen and Alto) Business World ranked us among the countrys five most respected companies Business World ranked us the countrys most respected automobile company Voted Manufacturer of the year by CNBC Voted one of Indias Greenest Companies by Business Today-AC Nielson ORG-MARG2003 Maruti 800, Maruti Zen and Maruti Esteem make it to the top 10 automotive brands in "Most Trusted Brand survey 2003" J D Power ranked 3 models of Maruti on top: Wagonr, Zen and Esteem Maruti 800 and Wagonr top in NFO Total Customer Satisfaction Study 20032001 MUL tops in J D Power CSI (2001) for 2nd time in a row: another international first owBabasabpatilfreepptmba.com Page 21
  22. 22. Does Maruti Finance Helps MUL increase its sales Maruti Finance2000 Maruti bags JD Power CSI - 1st rank; unique achievement by market leader anywhere in the world1999 MSM launched as model workshop in India; achieves highest CSI rating. Central Board of Excise & Customs awards Maruti with "Samman Patra", for contribution to exchequer and being an ideal tax assessee1998 CIIs Business Excellence Award1996 Maruti wins INSSAN award for "Excellence in Suggestion Scheme" Awarded the Star Trading House status by Ministry of Commerce1994-95 Engineering Exports Promotion Councils award for export performance1994 Best Canteen award among Haryana Industries as part of employee welfare1992-93 Engineering Exports Promotion Councils award for export performance1991-92 ♦ Engineering Exports Promotion Councils award for export performanceThe Quality AdvantageMaruti Suzuki owners experience fewer problems with their vehicles than any other carmanufacturer in India (J.D. Power IQS Study 2005). The Alto was chosen No.1 in thepremium compact car segment and the Esteem in the entry level mid - size car segment across9 parameters.The J.D. Power APEAL Study 2005 proclaimed the Wagon R no. 1 in the premium compactcar segment and the Esteem No.1 in the entry level mid - size car segment. This studymeasures owner in terms of design, content, layout and performance of vehicles across 8parameters.A Buying Experience Like No OtherBabasabpatilfreepptmba.com Page 22
  23. 23. Does Maruti Finance Helps MUL increase its sales Maruti FinanceMaruti Suzuki has a sales network of 307 state-of -the-art showrooms across 189 cities, with aworkforce of over 6000 trained sales personnel to guide our customers in finding the right car.Our high sales and customer care standards led us to achieve the No.1 nameplate in the J.D.Power SSI Study 2005.Quality Service Across 1036 CitiesIn the J.D. Power CSI Study 2005, Maruti Suzuki scored the highest across all 7 parameters:least problems experienced with vehicle serviced, highest service quality, best in-serviceexperience, best service delivery, best service advisor experience, most user-friendly serviceand best service initiation experience.92% of Maruti Suzuki owners feel that work gets done right the first time during service. TheJ.D. Power CSI study 2005 also reveals that 97% of Maruti Suzuki owners would probablyrecommend the same make of vehicle, while 90% owners would probably repurchase thesame make of vehicle.One Stop ShopAt Maruti Suzuki, you will find all your car related needs met under one roof. Whether it iseasy finance, insurance, fleet management services, exchange- Maruti Suzuki is set to providea single-window solution for all your car related needs.The Low Cost Maintenance AdvantageThe acquisition cost is unfortunately not the only cost you face when buying a car. Althougha car may be affordable to buy, it may not necessarily be affordable to maintain, as some ofits regularly used spare parts may be priced quite steeply. Not so in the case of a MaruitSuzuki. It is in the economy segment that the affordability of spares is most competitive, andit is here where Maruti Suzuki shines.Lowest Cost of OwnershipThe highest satisfaction ratings with regard to cost of ownership among all models are allMaruti Suzuki vehicles: Zen, Wagon R, Esteem, Maruti 800, Alto and Omni.We are proud to have the lowest cost of operation/km (among petrol vehicles) - the top 5models are all Maruti Suzuki models : Maruti 800, Alto, Zen, Omni and Wagon R.Babasabpatilfreepptmba.com Page 23
  24. 24. Does Maruti Finance Helps MUL increase its sales Maruti FinanceQuality SystemAt Maruti, our approach to quality is in keeping with the Japanese practice--"build it into theproduct". Technicians themselves inspect the quality of work. Supervisors educate andinstruct technicians to continually improve productivity and quality. The movement of qualityindicators is reviewed in weekly meetings by the top management.In 2001, Maruti Udyog Ltd became one of the first automobile companies anywhere in theworld to get an ISO 9000:2000 certification. AV Belgium, global auditors for InternationalOrganization for Standardisation(ISO), certified Maruti after a four day long audit, coveringvaried parameters like Customer Focussed organization, Leadership, Involvement of people,Process approach, System approach to Management, Continual improvement, etc.In May 1995, Maruti got ISO 9002 certification. The audit for this covered quality assurancein production, installation, marketing and sales as well as after sales services. We were alsoone of the first companies in the world to pioneer ISO 9000 certification for our dealers.In October 1993, MUL passed the Conformity Of Production (COP) Audit, which is based ona European Union Directive. This authenticated our quality systems and testing facilities forexport to Europe.Our emphasis on total quality has meant that today we are in a position to guide vendors anddealers in establishing and consolidating their individual quality systems. This commitment toquality has ensured a consistently satisfying product and world-class sales and after-salesservices.A new feather was added recently in Maruti’s cap in the field of quality when the QualityManagement System of its Press Shop & associated functions (collectively termed as PressFunction) got certification for conformance to the requirements of TS16949:2002 standard.The need for TS certification of Press Function had its genesis in the prestigious project thatMaruti earned for the supply of stamped panels to General Motors India for one of itsforthcoming models.Babasabpatilfreepptmba.com Page 24
  25. 25. Does Maruti Finance Helps MUL increase its sales Maruti FinanceAs a part of Quality system requirements, GM requires all its suppliers to be certified to eitherISO TS 16949 or QS 9000.These standards address Quality System requirements, which are particularly specific to theautomotive industry and requires an organization to be in compliance with ISO 9000 systemsas a basic requirement. However, whereas QS 9000 would become defunct and cease to existafter Dec 2006, TS 16949 is going to be the standard of the future.The TS 16949 standard, brought out by ISO in the year 1999, is an extension of the ISO9001:2000 standard that prescribes Quality management system requirements that arespecifically applicable to the automotive industry.TS 16949 has gained high popularity and almost all major automobile players across theglobe including GM, Ford, Daimler Chrysler, Nissan, Honda are embracing & promoting itIt incorporates a series of continuous small and simple improvements, which aim at involvingemployees at all levels.The Suggestion Scheme is based on the same principle. Under this scheme, employees areencouraged to make suggestions for improvement in any area of our operation. Over 50,000suggestions are received from employees every year.Maruti has won the First place in "Excellence in Suggestion Scheme Contest 2003", which isthe 6th consecutive award won in as many years. This contest is organized by IndianNational Suggestion Schemes Association (INSSAN). Since 1998 Maruti has won this award10 times."Quality Circles" are groups of five to eight members from a particular work area who workas a team to identify priorities and solve work related problems in the area.We believe that it is this unwavering commitment to quality that will lead to the furthergrowth of the organization as competition increases.Kaizen is based on the concept of making incremental improvements in our productsAbout N2N Fleet ManagementCar maintenance is a time-consuming process, especially if you own a fleet. Maruti’s newN2N Fleet Management Solutions for companies, takes care of the A-Z of your automobileBabasabpatilfreepptmba.com Page 25
  26. 26. Does Maruti Finance Helps MUL increase its sales Maruti Financeproblems. These services include end-to-end backups/solutions across the vehicle’s life:Leasing, Maintenance, Convenience services and Remarketing.When companies lease a fleet from us, they get vehicles in prime running condition plus anattractive lease EMI. They also take responsibility for the reliability and performance of yourentire fleet throughout the lease period. There state-of-the art maintenance services ensurethat our vehicles are in excellent shape and give a great ride each time you are on the goBesides Fleet Solutions for company owned cars, Maruti also offers this service foremployee-owned cars. With N2N on board, car problems are things that happen to otherpeople. So just sit back, relax and race ahead with the times. With Maruti, your car is in goodhands. ♦ Corporate buyers now enjoy the following benefits ♦ Single window processing for delivery at multiple locations Since vehicle prices differ from place to place we will coordinate the delivery of these vehicles at different locations for you ♦ Total customer solutions You can avail of ♦ A wide variety of financial options through our joint-venture finance companies ♦ Extended Warranty ♦ Annual Maintenance Contract at select dealerships ♦ Comprehensive lease packages ♦ CNG fitment in cities where CNG is available ♦ Bulk incentive schemes ♦ You are also entitled to incentives on bulk sales, which may differ from time to time and from one model to anotherMaruti at a considerably lesser price is an opportunity you wouldnt want to miss. Now youcan book your Maruti at any CSD Area Depot, anywhere in the Country, and buy a Maruti atBabasabpatilfreepptmba.com Page 26
  27. 27. Does Maruti Finance Helps MUL increase its sales Maruti Financeconsiderably less the market price. One more reason to be the proud owner of Indias mostsought after car!Who can book?All commissioned officers -- either retired or currently serving in the Indian Army, Navy orAir Force -- can avail of a sales tax exemption on the purchase of a Maruti Gypsy or indeedany Maruti vehicle. All you have to do is, select your preferred model from the entire range ofMaruti Cars and book right away!Sales tax relief for the Armed ForcesYou can avail of a sales tax exemption in various states across the country. In a few states, thesales tax is considerably lower than the rest of India. Which means, if you book your Marutithrough the CSD Depot in Punjab, Bihar, Gujarat, Maharashtra, Goa, Andhra Pradesh, Kerala,Tamil Nadu, Nagaland, etc, you will get a considerable tax relief.The sales tax exemption pertains to Maruti vehicles purchased through the Canteen StoresDepartment (CSD).Your reliable Maruti…delivered promptly. Before you know it, you will be driving away withyour Maruti in no time. Now you can look forward to many pleasurable moments on the road!Babasabpatilfreepptmba.com Page 27
  28. 28. Does Maruti Finance Helps MUL increase its sales Maruti FinanceIntroductionOne company that redefined the way people looked at cars, Maruti Suzuki. In the past 23years Maruti Suzuki has emerged as the undisputed leader in the automobile industry,bringing more cars, more technology and more satisfaction. Today, Maruti Suzuki givesanother reason to smile. Maruti Finance, empowers to buy the car we want, on our terms.Maruti has partnered with leading Finance companies in India to provide highly attractivefinance deals to its customers through its authorized dealers. Maruti finance is the programunder which these deals are being offered exclusively to customers of Maruti vehicles.Features:Best Interest RatesMaruti Finance offers the best rates of interest. The installment schemes are designed to suitcustomers convenience and other requirements. The interest rate offered for car financingdepends on the credit evaluation of the customer by the Finance company. However, the ratesoffered by Maruti Finance are 0.25% to 0.5% lower than those available in the market acrossall credit profilesValue Added ServicesExtended warranty:Maruti Finance gives us the privilege of extended warranty that goes up to four years! Thismeans four years of hassle-free maintenance. we can get up to 30% discount on extendedwarranty under Maruti Finance.Customized loan schemesThey have a number of customized loan schemes. Their finance advisor will help in choosingthe one that best suits the needs of customers. So the customer can either have a initial downpayment or low EMIs.Loans for Insurance and AccessoriesBabasabpatilfreepptmba.com Page 28
  29. 29. Does Maruti Finance Helps MUL increase its sales Maruti FinanceLoans for insurance and accessories are built into the EMIs, keeping the whole deal simpleand hassle free.Transparent transactionsMaruti Finance is reliable, transparent and convenient. We simply need to walk into anauthorized Maruti Suzuki dealership, for the best cars and the best finance options!After all it is a better way to buy a car!One Stop ShopFrom Finance to Insurance. From used cars to genuine accessories. When it comes to carelated needs all we have to do is to contact nearest Maruti Suzuki Dealer.MARUTI FINANCE PARTNERSEarlier, Maruti has tied up with 8 finance companies to form a consortium. This consortiumcomprises Citicorp Maruti, Maruti Countrywide, ICICI Bank, HDFC Bank, Kotak Mahindra,Sundaram Finance, ABN Amro Bank, & Standard Chartered Bank.But now in current year 2005-06 Maruti Finance has 6 finance companies excluding ABNAmro & Standard Chartered bank.Babasabpatilfreepptmba.com Page 29
  30. 30. Does Maruti Finance Helps MUL increase its sales Maruti Finance Structure of Maruti Finance Partners CITI CORP MARUTI FINANCE LTD MARUTI COUNTR YWIDE ICICI AUTO BANK FINANCEINTRODUCTION TO MARUTI FINANCE PARTNERS BRIEF LTD MARUTI FINANCE SUNDAR AMICICI Bank is Indias second-largest bank with total assets of about Rs.1,67,659 crore at HDFC FINANCEMarch 31, 2005 and profit after tax of Rs. 2,005 crore for the year endedLTD 31, 2005 (Rs. BANK KOTAK March MAHIND1,637 crore in fiscal 2004). ICICI Bank has a network of about 560 branches and extension RAcounters and over 1,900 ATMs. ICICI PRIMUS Bank offers a wide range of banking products and LTD.financial services to corporate and retail customers through a variety of delivery channels andthrough its specialised subsidiaries and affiliates in the areas of investment banking, life andnon-life insurance, venture capital and asset management.The Housing Development Finance Corporation Limited (HDFC) was amongst the first toreceive an ‘in principle’ approval from the Reserve Bank of India (RBI) to set up a bank inthe private sector, as part of the RBI’s liberalisation of the Indian Banking Industry in 1994.Babasabpatilfreepptmba.com Page 30
  31. 31. Does Maruti Finance Helps MUL increase its sales Maruti FinanceThe bank was incorporated in August 1994 in the name of ‘HDFC Bank Limited’, with itsregistered office in Mumbai, India. HDFC Bank commenced operations as a ScheduledCommercial Bank in January 1995Maruti Countrywide was set-up when GE Capital and Maruti Udyog Limited formed acaptive finance company in 1995A professionally managed company, they share the ideals and work culture of the parentcompanies. Their prime objective is to cater to the needs of Maruti car buyers by offeringinnovative finance schemes for the purchase of Maruti cars.GE Countrywide. Help Indian consumers fulfil their aspirations with quick and easy loans.Set up in 1994 and currently operating out of 62 locations in the country, GE Countrywidepioneered the Consumer loan revolution in India.Babasabpatilfreepptmba.com Page 31
  32. 32. Does Maruti Finance Helps MUL increase its sales Maruti FinanceCiticorp Maruti Finance Limited was formed when Maruti joined hands with Citibank in May1998.Located in 52 cities, CMFL is the first company that provides services to finance the purchaseof secondhand cars nationally. They also offer a wide range of flexible and customizedfinancing options at affordable rates to individuals buying a Maruti car.Citibank understands that every car buyers needs are different. This is the reason why theyoffer car loan schemes that suit customer requirements.Citibank Auto Loan makes paying back a car loan easy by offering you a loan that stretchesyour payments upto 60 months.Citibank Auto Loan gives you a benefit of making a down payment of only 10%.They also offer you the most competitive interest rates.With a Citibank Auto Loan customers can acquire a loan with minimum fuss and maximumassistance. If you are salaried, all you require is a salary certificate from your company, copyof your CPR & Passport and your bank account statement for the last three months.If your are self employed all we require is a copy of your CR, a copy of your CPR, and bankstatements for the last three monthsCitibank offers you a unique opportunity to Cash-in-your-car.Arranging a loan can often prove difficult and inconvenient. At best, it can be a time-consuming and lengthy process, unless the bank is Citibank.Kotak Mahindra Primus Limited (KMPL) is a joint venture between Kotak Mahindra BankLtd. (KMBL) and Ford Credit International Inc. (USA)(FCII) formed to finance all non-Fordpassenger vehicles. The Joint Venture is dedicated to financing and supporting automotiveBabasabpatilfreepptmba.com Page 32
  33. 33. Does Maruti Finance Helps MUL increase its sales Maruti Financeand automotive related manufacturers, dealers and retail customers. The Company wasincorporated on 28th February 1996 and commenced its operations on 1st November 1996.After incorporation and subsequent commencement of the business by the joint venture, thebusiness of financing non-Ford passenger cars and its related activities, previously carried outby KMFL, is being undertaken by KMPL. The Company has immensely benefited from thebrand equity of "Kotak Mahindra" who were market leaders in the auto finance sector.Kotak Mahindra is one of Indias leading financial institutions, offering complete financialsolutions that encompass every sphere of life. From commercial banking, to stock broking, tomutual funds, to life insurance, to investment banking, the group caters to the financial needsof individuals and corporatesThe group has a net worth of over Rs.1,800 crore and employs over 4,400 employees in itsvarious businesses. With a presence in 82 cities in India and offices in New York, London,Dubai and Mauritius, it services a customer base of over 5,00,000.Kotak Mahindra has international partnerships with Goldman Sachs (one of the worldslargest investment banks and brokerage firms) and Old Mutual (a large insurance, bankingand asset management conglomerate).The Kotak Mahindra Group was born in 1985 as Kotak Capital Management FinanceLimited. This company was promoted by Uday Kotak, Sidney A. A. Pinto and Kotak &Company. Industrialists Harish Mahindra and Anand Mahindra took a stake in 1986, andthats when the company changed its name to Kotak Mahindra Finance LimitedKotak Mahindra Primus Limited (KMPL) is a joint venture between Kotak Mahindra BankLtd (KMBL) and Ford Credit International Inc. (USA) (FCII) formed to finance all non-Fordpassenger vehicles. SUNDARAM FINANCEBabasabpatilfreepptmba.com Page 33
  34. 34. Does Maruti Finance Helps MUL increase its sales Maruti FinanceSundaram Finance has grown over the past decades on the foundations of dedicated customerservice, fair business practices, efficient, safe and trusted financial policies.The Company was incorporated in 1954, with the object of financing the purchase ofcommercial vehicles and passenger cars.The company was started with a paid-up capital of Rs.2.00 Lakhs and later went public in1972.The Companys shares were listed in the Madras Stock Exchange in 1972 and in the NationalStock Exchange in January 1998Subsequently, the equity shares of the Company have been delisted from Madras StockExchange Limited (MSE) with effect from January 27, 2004, in accordance with SEBI(Delisting of Securities) Guidelines, 2003, for voluntary delistingSundaram Finance Ltd registers Rs. 75.99 Cr. Net Profit for FY05Disbursements rise to Rs. 2887 Cr.Net NPA halves to 0.45%Leading Financial Services company Sundaram Finance Limited (SFL) has announced that ithas registered a Net Profit of Rs. 75.99 Cr. for the year ended 31st March 2005. The companyhad ended 31st March 2004 with a Net Profit of Rs.55.62 Cr.. However, the numbers (relatingto FY04 and FY05) are not strictly comparable on account of the merger of Lakshmi GeneralFinance (LGF) with SFL during the year.Finance options for new carSundaram Finance Group provides car finance for all models of cars through 100 pluslocations that are spread all over the country. The documentation required is minimal andthere are no hidden costs. Our procedures are transparent and hassle free. Details of some ofthe schemes that have been designed with you in mind are given below.Finance optionsThe maximum finance period is for 36 months and this also depends on the model and the ageof the car being financed. The age of the car including the financing period is generallymaintained at a maximum of 5 years. The maximum amount of finance that is given would be60% of the assessed valueBabasabpatilfreepptmba.com Page 34
  35. 35. Does Maruti Finance Helps MUL increase its sales Maruti FinancePROFILEBimal Auto Agency (Bangalore) – A Maruti-Suzuki authorized dealer –is among the few ISO9001 certified dealerships in the country. Spread over 125000 sq ft, the Bimal campus is oneof the biggest in India and is designed with customer convenience in mind. All facilities –Sales, Service, Body Repairs and Spares are in the same premises. Moreover, there arefacilities for accessories, extended warranty, insurance, finance and pre-owned cars.Bimal auto agency, the flagship company, was established in the year at Guwahati(Assam). Itstarted with Bajaj Tempo and Hindustan Motors spare-parts dealerships and in 1984established the Maruti dealership.sodsequently, it went on to become dealers for Yamaha andLML range of two-dealers. In the year 2002, Bimal started the Maruti-Suzuki dealership atBangalore. With combined sales of over 6000 cars, it is among the largest Maruti Dealershipgroups in the country. It is fully owned and managed by the Sarawagi family members. Otherfamily business interests include Petroleum outlets, transport business and coffee plantations.Bimal Auto Agency - located on Whitefield Road, Bangalore’s IT hotspot is the Marutidealership that has created waves in Bangalore. The success comes from our keen eye fordetail, quality and the standards & policies that is based on satisfying the customer’s everyneed. We intend to make our dealership, a byword for quality and customer delight inBangalore.Babasabpatilfreepptmba.com Page 35
  36. 36. Does Maruti Finance Helps MUL increase its sales Maruti FinanceBimal has been honoured with the following at the All India Maruti Dealer onferences:Sales Infrastructure – All India Best New Showroom 2003Service Infrastructure – All India Best New Workshop 2002Service Infrastructure – All India Best New Body Repairs Workshop 2003Leadership – Young Entrepreneur Of The Year Award for Mr. Naveen Sarawgi, CEOInnovation – All India Best Practices on Product Customization 2003Babasabpatilfreepptmba.com Page 36
  37. 37. Does Maruti Finance Helps MUL increase its sales Maruti FinanceBEST PRACTISES IN BIMAL AUTO AGENCY WORK SHOP Regular morning meetings and exercise. Identifying the weaker areas and training in-house. Training process to improve their efficiency. Same Service Advisor for receiving and delivering vehicles. Every customer complaint is taken for detailed study, the concerned are educated. Analysis of final inspection report by Works Manager on weekly basis. Weekly meeting with washing supervisor to improve washing quality. Random check of vehicle before delivery. Works manager does special customer’s service vehicle follow-up Free pickup and drop for all customers on request. Welcome drink to all customers’ refreshment at lunchtime for wait and take customers. All managers from service is present while receiving and delivering vehicles. Regular camps are conducted in corporate houses and housing complexes. Marketing teams with photo album to authenticate the facility available. Every employee of Bimal is a spokesman of dealer and trained to market the services Discount and free wash coupons are distributed during the camps. 24hours MOS operations on free of cost basis for Break Down Repairs. 8 a.m to 8.p.m service and Sunday working for customer convenience. Visiting customers, to build relationship. Dedicated Mobile numbers for pickup and drop Monthly Customer Interactive Meet for collecting the feedback. Bonus on service is offered as a tool for retaining customer. Hotlines for services, pick up & drop, insurance renewals & breakdown. All service vehicles are polished. All vehicle interiors are cleaned by vacuum cleaner Special highly skilled team to resolve customer complaints identified through PSF, Feedback Card etc.,Babasabpatilfreepptmba.com Page 37
  38. 38. Does Maruti Finance Helps MUL increase its sales Maruti FinanceSERVICE MARKETINGInitially we started brand building through Marketing Executives by conducting camps atCorporate Houses, Housing Colonies, Business Centres etc,.Now we appointed a Business Development officer to improve our penetration in the area ofservice and selling special products like Insurance, Extended Warranty etc,.We have one exclusive person who does the SMR .SMR has been a very important tool to improve our service load over a period of time.Through SMR an average of 800 customers are contacted per month.The enforcement ratio is approximately 85%.The enforcement ratio through SMR is around 55%PICK UP & DROP FACILITYWe had introduced the pick up & drop facility right from the beginning, which has providedmaximum convenience to our customers.Hotline for picks up & drops.An average of 35% vehicles are picked up for service & dropped back at customer’s placewhich constitutes to 18 to 20 vehicles per day.This facility has been one of the factor in building our service load.One person is in charge of controlling the drivers who are utilised for pick up & drop.Babasabpatilfreepptmba.com Page 38
  39. 39. Does Maruti Finance Helps MUL increase its sales Maruti FinanceSWOT AnalysisSTRENGTHS Infrastructure Processes & Systems Leadership Industry Experience Bimal Edition Vehicles (Customization of Cars)WEAKNESSES Location Parking SpaceOPPORTUNITIES Field Sales ITPLTHREATS Competition Branche Bimal DCBabasabpatilfreepptmba.com Page 39
  40. 40. Does Maruti Finance Helps MUL increase its sales Maruti FinanceOBJECTIVE OF THE STUDY:Primary Objectives:1. To study the loan approval procedures of all finance companies, which come under MARUTI FINANCE consortium.2. To Study of Market Shares of Maruti Finance Partners & Bimal Auto AgencySecondary1. Study of Maruti Udyog Ltd in general and Maruti Finance in Particular.FL2. Study of Indian Auto Industry in general and Auto financing in IndiMETHODOLOGY OF THE STUDY Observing the actual working of various departments mainly finance department and also marketing dept. Analyze the functions performed by finance & marketing departments Study the objectives, growth and achievements of each department in particular and the organization as a whole. Visiting the banks to study the approval procedure with the finance executive.The research design is divided into two partsPART 1 Loan Approval Procedural study of Maruti Finance PartnersPART 2 Study of Market Shares of Maruti Finance Partners & Bimal Auto AgencyCollection of data –There are different methods by which data can be collected. The following methodswere adopted in collecting the information required for the project study –Primary source – different documents of the company like official records, manualsface-to-face interview with officials were done to collect information . In the face-to-face interview officers where highly knowledgeable and experienced were met to getextensive information about the concerned topic.Babasabpatilfreepptmba.com Page 40
  41. 41. Does Maruti Finance Helps MUL increase its sales Maruti FinanceSecondary data – in this Method Company’s Brochure, Magazines, manuals andAnnual Reports were studied to collect data. The Official Records will give detailinformation about the past, present and future plans of the company. Accurate vitalstatistical information can also be collected from such records.Limitations of the study – The data collected was informal. The working executives inside the organization did not reveal much information for the study. The study is limited to Maruti cars buyers only The study tells only about Maruti finance & its consortium.Babasabpatilfreepptmba.com Page 41
  42. 42. Does Maruti Finance Helps MUL increase its sales Maruti FinancePART 1Loan Disbursement procedure at Maruti Finance Step by Step approval procedure of Car loan Step 1 Car Loan Products Step 2 Deciding Customer Requirements Step 3 Collection Of Pre Documents Step 4 File Logins In Banks Step 5 Field Verification & Tele Verification Step 6 Loan Approval & Deviation On Approval Step 7 Rate Approval & Deviation On Rate Approval Step 8 Collection Of Post Documents Step 9 Disbursements Step 10 Issue Of Delivery Order To Dealership Step 11 Delivery Of Cars To CustomersStep 1CAR LOAN PRODUCTS:Each banks/finance companies are having different schemes /products. Following arethe some productsBabasabpatilfreepptmba.com Page 42
  43. 43. Does Maruti Finance Helps MUL increase its sales Maruti FinanceICICI : Loan On Phone (for existing icici customers) 8 yr Product for M800 100% loan scheme 90% loan scheme – A3 Segment (esteem, baleno, versa) No Income Proof SchemeHDFC: On road 85% for 7 yrs on M800 & alto 100% loan scheme 90% loan scheme – A3 Segment (esteem, baleno, versa) Step Up EMI Scheme up to 7 yrsMCW: Special Offer for GE Employees (Quick approval) Step Up scheme up to 7 yrs (launched by MCW first time) )(here initially EMI will be lesser & gradually rises till the tenure ends). 100% fundingCMFL : 90% funding Suvidha Existing customers Scheme(Quick approval) Special Scheme for gold Card holders & Dinus Club membersKMPL :Babasabpatilfreepptmba.com Page 43
  44. 44. Does Maruti Finance Helps MUL increase its sales Maruti Finance Margin money-- This is a regular scheme wherein you pay a minimum margin of 25% on the cost of the car. The balance cost is financed and you repay with finance charges in equated monthly instalments (EMI). Advance EMI-- In addition to margin money, based on your cash flow, you can pay 2-3 instalments in advance. The advantage here is that the finance charges will be less than the above margin money scheme Security deposits-- Here you place a refundable security deposit (of about 10% to 25% of the cost of the car) with us, which carries an interest at an agreed rate. The finance charge is payable on the total cost of the car. 100 % finance-- Here we provide 100% finance on the cost of the car for varying tenures. This is a facility provided under the lease option for medium and large corporates No Income Proof Scheme Bullet payment Scheme(in this scheme customer can repay as much as he can as there is no fixed emi, but last installment must be lumpsum) 90% funding 5 yrs Tenure SchemeSFL: Flexible Scheme :You decide Your Emi Scheme (customer has to choose their emi which suits their pocket, max 48 months, it should be step up , remaining amount they have to pay at 48th installment lump sum. If they are not affordable to pay on 48th installment, they can extend loan for further 2 yrs) Asset Proof Scheme: (asset must)(applicable for low income individuals) Guarantor Scheme ( outside guarantor also)Note: The above funding products is not constant. It depends on customer profile &criteria’s. As they match according to bank criteria his funding will rise otherwise itdeclines.Step 2DECIDING CUSTOMER REQUIREMENTS:Babasabpatilfreepptmba.com Page 44
  45. 45. Does Maruti Finance Helps MUL increase its sales Maruti FinanceOnce customer approaches for Car Loan, Concerned Dealer Sales executives will givevarious options and quotations to the customers. Sometimes customers ask for exactloan amount and loan tenures according to their requirements. Otherwise Salesexecutives have to give various options of finance facilities as below.♦ Lesser loan amount for lesser tenure. (75 to 80% loan for 1 to 4 yrs.)♦ Lesser loan amount for Maximum tenure.(75 to 80% loan for 5 to 7 yrs)♦ Maximum Loan amount for lesser tenure (90 to 100% loan for 1 to 4 yrs)♦ Maximum loan amount for maximum tenure. (90 to 100% for 5 to 7 yrs)Now customers are required to select any one of the above options according to theirneed. At present most of the customers are asking least down payment schemes, i.e.Maximum Loan amount for maximum Tenure with least rate of Interest. Finalizationof loan amount and tenure is mainly based on customers profiles.Since loan approval is the sole discretion of finance companies,In practice, Credit is the sole discretion of finance companies; each finance companywill have different criteria. Some of the criteria are as follows. ♦ Income tax returns ♦ Residential Status ♦ Job Continuity ♦ Salary drawings ♦ Repayment track of existing loan ♦ Bank transactions copyCustomers have to give all supporting documents in connection with above criteria’s.If any deviations are there in the above-mentioned criteria, the required loan amountor the Tenure will be affected proportionately.Step3Babasabpatilfreepptmba.com Page 45
  46. 46. Does Maruti Finance Helps MUL increase its sales Maruti FinanceCOLLECTION OF PRE DOCUMENTSOnce customers accept the finance quotation made by Dealer Sales Executive, he has toprovide same basic documents for taking loan approval. These documents are called Preapproval Documents. Normally these documents remain to same in most of the financiers.Sl. Documents For Salaried For Self For For Private/ employed partners Public LtdNo hip companies Firms1 Application Form duly filled and YES YES YES YES signed by customer2 1 Photo YES YES YES YES3 Residence Proof (Copy of Electricity bill or Telephone bill or laminated driving license or Voters YES YES YES YES identity card or Ration card or passport or Rental Agreement. (any one)4 Signature proof (Pan Card, Driving License, Passport, Bankers YES YES YES YES Verification.5 Identity proof & Age Proof (Passport, Pan card, Driving Licence , Voters Identity card, YES YES YES YES Photo Credit Card, Photo ration Card.)6 Proof of Latest Bank Statement YES YES YES YES for Last 3 to 6 months7 Latest Salary Slip YES NO No YES8 Form No 16 for Last Year YES NO NO NO9 Income Tax Returns for Last 2 yrs. NO YES YES YES10 Computation Copy with Profit & loss NO YES YES YES account for Last 2 years.11 Partnership Deed NO NO YES NO12 Memorandum & Article Of NO NO NO YES Association13 Board Resolution authorizing One NO NO NO YES Director to execute the agreement.Step4FILE LOGINS IN BANKSBabasabpatilfreepptmba.com Page 46
  47. 47. Does Maruti Finance Helps MUL increase its sales Maruti FinanceOnce the collection of pre documents is over, Finance executives will LOGIN the file inconcerned banks for Approval. Since Different banks are having different procedures toLOGIN, the detailed summary of each Financier furnished below.ICICI BANK:In ICICI Bank, there is one Outsourcing Unit called CPA (Credit Processing Authority)which is owned & maintained by leading Chartered Accountants situated in the samepremises. After collection of Pre-documents, concerned finance executive has to preparecustomer File and they have to submit such files to CPA. It is the duty of CPA to check all thecollected documents and verify the accuracy of the documents like below. ♦ Whether application s dully filled or not, ♦ Whether all attached documents are self attested by customer or not, ♦ Incomplete files not accepting in CPA ♦ If any discrepancy found, CPA will communicate to customers through concerned executives and ensure that discrepancy is overcome. ♦ Allotment of file numbers, ♦ Updating files in MIS ♦ Updating of approval Status in MIS ♦ Sending File Status (MIS) to dealer thrice in a day by emailHDFC BANKHDFC also appointed a Chartered Accountant Firm as CPA and the office was not situated insame premises. Like ICICI, here also systems & procedures are more or less same. Daily oncethey are sending MIS to all channels.MARUTI COUNTRYWIDE AUTO FINANCE LTD:-The System is entirely different here. There is no CPA here in MCW. The Whole system iscentralized. The Regional office of MCW is situated at Chennai. Once the file login,documents will get scanned in the branch & Sent it to Regional OfficeThrough online. Once the file is received, RO will allot file & if find any discrepancy theywill communicate to Branch Office where it is sourced. Here the Branch office does not haveauthority to modify or change the documents. To view the file, Branch need to feed filesBabasabpatilfreepptmba.com Page 47
  48. 48. Does Maruti Finance Helps MUL increase its sales Maruti Financenumber in the online system.CITICORP MARUTI FINANCE LTD :-Citi Bank has outsourced file logins to different department called CPA.The activitiesperformed by CPA is same as in HDFC /ICICI.KMPL & SUNDARAM FINANCE LTD:In case of Kotak Mahindra & Sundaram Finance. There is no separate entity to handle filelogins. All the activities are centralized; logins & verifications are done by Bank itself.Babasabpatilfreepptmba.com Page 48
  49. 49. Does Maruti Finance Helps MUL increase its sales Maruti FinanceMIS format as belowS.No App ID App Cust name Vehicle Dlr DSA Status Comments Loan Tenure LTV(%) DSE Disb Name Name amt Rcd date date68 507892 16/07 Shiva Esteem Bimal Bimal To Ops 384000 60 83 03 /05 Shankar LxiBabasabpatilfreepptmba.com Page 49
  50. 50. Does Maruti Finance Helps MUL increase its sales Maruti FinanceStep 5FIELD INVESTIGATION & TELE VERIFICATIONThe main reason behind conducting FV & TV is to ensure whether the address given by thecustomer is genuine or not,. In case of ICICI, HDFC, MCW, CMFL & Kotak, verificationhas been done by separate agency which works for Bank. .Once the verification is initiated bythe Bank; Agency will personally visit to both office & Resident Address of applicant forfield verification and make report on that and communicate results to Bank. In case of TeleVerification, the Agency will not meet personally but contact them over phone both office &residents to get details. Questions are designed in such a way that they will cover followingfactors: ♦ Credit Entity’s identity ♦ Stability of residents ♦ Family Structures & Age ♦ Sources of Income ♦ Own house or rented house. ♦ Vehicles or Assets Owned. ♦ Standard of Living.There are some entities, which are considered as negative profile, which will come to know atthe time of investigation. The usual negative profiles are; ♦ Contractual Employees ♦ Politicians ♦ Policemen (Except IPS & IAS) ♦ Video Parlor Operators ♦ Bar Owners ♦ Chit Funds ♦ Real Estate Agency ♦ Advocates (Except High Court & Supreme Court lawyers) ♦ Film industry professionals ♦ Builders, Contractors & Building Materials SuppliersBabasabpatilfreepptmba.com Page 50
  51. 51. Does Maruti Finance Helps MUL increase its sales Maruti FinanceFor the above-mentioned profiles, all banks/finance companies are taking precautions beforeapproving files. Precautions like low LTV (Loan To Value) like 50 to 60%, shorter tenure like2 to 3 yrs, etc.Moreover in Sundaram Finance Ltd., there is no separate Agency for field Investigation &tele verification and this process get done through their own staff. Field officers are visitingcustomer’s residence & office and submit the reports to the branch manager for approval.Babasabpatilfreepptmba.com Page 51
  52. 52. Does Maruti Finance Helps MUL increase its sales Maruti FinanceStep 6LOAN APPROVALAfter the field and tele verification has been done, the agency sends the report back to thebank confirming the customer status. If the report is positive, then further loan procedure ispreceded or if the report shows negative the case is dropped at first instance itself. If thenegative status in the FI Report is for minor reasons, sales manager /credit manager are takingdeviations.The documents collected from the customer are taken to bank. The person approving the loanis known as Credit Manager or Credit Buyer. His duty is to see the customer profile andapprove the loan accordingly. The Bank / Finance Companies have their own criteria’s andprocedures for approval of loans and based on these, the Credit Manager will approve theloan. However these criteria’s & procedures will differ from one Bank to another. The mainoutlooks of these criteria’s & procedures stands below in respect to following companies.ICICI BANK & HDFC BANK:Linking of FI reports:After the completion of tele verification & filed verification, the credit department (CPA) inthe bank will link the above report to concerned customer files.Dedup Match:In this procedure, Credit Processing Authority will cross verify the earlier banking habits ofthe customer with ICICI or other banks. In case of existing customer they are cross checkingthe savings/current account transactions, credit card transactions, housing/car loan repaymentrecords etc., to confirm the creditability of the customer. If the customer is not an existingcustomer, then with the help of date of birth they can access the customer’s creditability withother banks/ financial institutions. After assessing the above all, the profile stands negativethen the file get rejected immediately at this stage otherwise the files moves towardspreparation of CAM.Babasabpatilfreepptmba.com Page 52
  53. 53. Does Maruti Finance Helps MUL increase its sales Maruti FinanceCredit Assess Memo:Now the CPA people are authorized to prepare a CAM based on customer profile and they arealso authorized to recommend the percentage of LTV (Loan to Value). In this CAM they arementioning the income stability of the customer, banking stability of the customer, jobcontinuity of the customer, business continuity of the customer, business stability of thecustomer, residence continuity of the customer, ownership resident/office of the customer andabout co-applicant also if required. Based on the above criteria they are fixing /recommending LoanToValue (LTV) Grid as shown in the chart below.LTV GRID Income <60K & NIP 60K-100K >100K-150K >150K Tenure 1-3 1-3 4-5 1-3 4-5 1-3 4-5 Category 1 70% 85% 85% 85% 85% 90% 85% Category 2 70% 70% 70% 85% 80% 85% 80% Category 3 60% 70% - 75% - 75% - Category 4 - 50% - 50% - 50% - Category 5 50% - - - - 60% -In case of NIP (No Income Proof) or income is less than Rs.60,000 normally they areapproving only 60 to 70% LTV, for a tenure of maximum of three years. Like that based oncustomer income as per Income Tax Returns the LTV and the Tenure will take a hike asshown in the above chart.The categories shown in the above table are based on the segment of cars like;CAT 1 – Maruti 800 / OmniCAT 2 – Alto / Zen / Wagon R / SwiftCAT 3 – Esteem / Baleno / VersaCAT 4 – VitaraAfter considering eligibility of the customer as per above gird they will mention thepercentage of LTV to be granted to the customer in the CAMApproval by Credit Manager:In this stage the full file with CAM will come over to Credit Manager’s desk to sign for finalapproval. After the scrutiny of file along with the CAM, if he is satisfied he can approve theBabasabpatilfreepptmba.com Page 53
  54. 54. Does Maruti Finance Helps MUL increase its sales Maruti Financeproposal for an eligible amount or other wise he may reduce the percentage of LTV to theextent of discomfort he founds in approvalE.g. If a customer’s applied LTV is 90% for 5 years and eligible LTV as per CAM is 75% for5 years, he can approve for a maximum extent 75% for 5 years. If he feels discomfort withfile, the LTV/Tenure may come down like he can approve for 75% for 3 years or 70% for 5years etc.,Deviation on Approval:Sometimes, if the applied LTV is more and same it is not under the Credit Manager’sDiscretion, he can ask for his superior’s consent or approval for such cases. The followingtable shows the flow/chain of authority people for approvals.Babasabpatilfreepptmba.com Page 54
  55. 55. Does Maruti Finance Helps MUL increase its sales Maruti Finance CREDIT MANAGER AREA CREDIT MANAGER REGIONAL CREDIT MANAGER ZONAL CREDIT MANAGER NATIONAL CREDIT MANAGERThe above chart also reveals that a common customer’s file can go up to National CreditManager’s level to take approval for applied LTV. One more interesting fact is that theprocess of these approvals takes place within a span of few minutes.CITI CORP MARUTI FINANCE LTD :The process of linking of FI reports, Dedup Match, preparation of CAM is more or less sameas in the ICICI/ HDFC Bank. The Credit Manager in the Bank authorized to do final approvalwith the consent of Sales Manager. Since CMFL is not approving more than 90% of LTV, thechances of deviations are very less. Comparing to ICICI/HDFC, here the maximum tenurealso restricted to five years. CMFL also giving special consideration on approval and tenuresfor Citi Bank Suvidha account holders and Citi Bank card holders. But maximum LTV andtenures are same for all.MARUTI COUNTRYWIDE AUTO FINANCIAL SERVICES LTD:As mention earlier the system of approval process also centralized at Regional office, (e.g.:Chennai is the regional office for all logins of Karnataka). Once the file is “Soft approved”( prima-facie approval ), the linking of FI reports, Dedup Match, preparation of CAM areBabasabpatilfreepptmba.com Page 55
  56. 56. Does Maruti Finance Helps MUL increase its sales Maruti Financeprocessed at regional office. At the end, the file goes to Credit manager at regional office for“Hard approval”. After hard approval, they will update the status of the file in online. Withina fraction of seconds after hard approval, Sales manager at local office can access the status ofa file and he can go ahead for further process.KOTAK MAHINDRA PRIMUS LTD.In Kotak Mahindra, the system of approval is flexible compared to all above banks. Afterlinking of FI reports, the Credit Manager approves the files as per credit norms. In case ofdeviations, file moves to Location Head/Branch Head for final approval. If LTV is more than95%, Area Manager or Head Office (Mumbai) approval is necessary.SUNDARAM FINANCE LTDField Officers at Sundaram Finance Ltd., are doing both field verification and primaryapproval also. Once the file is primary approved by field officers Branch Manager’s greensignal gives final approval on the file. Since the branch is entirely responsible for selling ofcar loans and recovery of loans, they are personally evaluating the customers’ stability,repayment capacity and guarantors profile rather than a mere verification of document/papers.Noticeably, SFL is the only one finance company accepts a third party guarantor as a co-applicant compared to other finance companies as they are accepting only family members(blood relatives) as guarantors.It is observed here that the percentage of recovery is more in SFL only due to this Third partyguarantor.Step 7COLLECTION OF POST DOCUMENTSAll banks / finance companies are having same system of collection of post documents. Afterthe approval, the executives has to visit customers place to collect post documents and theywill hand it over to the bank to attach with customer file.Babasabpatilfreepptmba.com Page 56
  57. 57. Does Maruti Finance Helps MUL increase its sales Maruti FinanceThe following is the list of post documents to be collected by the executives ♦ Agreement Copy (Duly signed by applicant) ♦ Money Margin Receipt. ♦ Post-dated cheque’s or Security Cheques (According to the finance co & tenure) r ♦ Electronic Clearing System (ECS) (For Salaried Class) ♦ Own house proof (Optional) ♦ Repayment Track (Optional) ♦ Credit Card Statement (Optional)Note: The ECS system is not applicable for KMPL & SFL companies, customers has tosubmit post dated cheques only since the company does not have the facility of ECS.Step 8RATE APPROVAL & DEVIATION ON RATE APPROVAL:The rate of interest is one of the most important factors to attract the customer towards carloans. The six finance partners, who have tied up with Maruti Finance, are giving veryBabasabpatilfreepptmba.com Page 57
  58. 58. Does Maruti Finance Helps MUL increase its sales Maruti Financecompetitive rates to its customers. Before starting Maruti Finance some finance companiesare charging more than 15% per annum for car buyers. The entrance of Maruti Finance,reduced the rate of interest by restricting it’s channel partners.In all the banks Branch Head/Sales Managers are authorized to fix/approve rate of interest.Normally, prevailing rate of interest to customer is 9% to 10% for Maruti 800/ Omni, 8.5% to9.5% for Alto / Zen / Wagon R / Swift, 7.5% to 8.5% for Esteem / Baleno / Versa. Theserates are possible only after giving some subsidy / subvention from Maruti Udyog Limited orDealers.Some banks like ICICI & HDFC, for the rate approvals only Branch Head is not authorized toapprove all rates. For deviation they are moving such files to higher officials like Area SalesManager, Regional Sales Manager, Zonal Sales Manager, National Sales Manager and finallyto Business Head.Step 9DISBURSEMENTSAfter getting rate approval, the file moves to Operation Department cum Finance Departmentfor Final Disbursements where the approved loans are getting readied for payments to thedealer.Babasabpatilfreepptmba.com Page 58
  59. 59. Does Maruti Finance Helps MUL increase its sales Maruti FinanceBefore preparing the payment, the Operation Department will scrutinize all the postdocuments. The following documents will scrutinized Checking all signature of customer in loan agreement Verification of post dated Cheques (Date, amount & signature) Verification of Margin Money Receipt Verification of Insurance Cover Note Verification of Pro-forma Invoice / Price List from Dealer Verification of ECS form & Security ChequesBabasabpatilfreepptmba.com Page 59
  60. 60. Does Maruti Finance Helps MUL increase its sales Maruti FinanceStep 10ISSUE OF DELIVERY ORDER & FORM – 20 TO DEALERSHIPAfter completion of disbursement process, the Operation Department will issue a deliveryorder to the dealer. It contains the loan amount, EMI, the dealer discounts if any adjusted andthe disbursement amount. Along with the delivery order, they are also issuing a Form – 20which is required for registration of vehicle at the Regional Transport Authority.Step 11DELIVERY OF CARS TO CUSTOMERSOn the basis of the financier’s Form – 20 & delivery order, the dealer will register vehiclewith the hypothecation of concerned financier. After registration customer will get thedelivery of vehicle.Once the new car is purchased the following documents have to be submitted to the RTO forregistration purposes; Copy of the invoice - (photocopy) Copy of the insurance cover-note / policy Residence proof. PUC certificate issued by the manufacturer (form no. - 22) Form -20 Imprint of Chassis No. PAN / GIR No 4 PhotosBabasabpatilfreepptmba.com Page 60
  61. 61. Does Maruti Finance Helps MUL increase its sales Maruti FinanceStep 12MAKING PAYMENT TO DEALERSHIPMore or less all Maruti Finance Partners arranged inventory funding/trade advance facilitiesto the dealership. In such case banks / finance companies are not supposed to prepareCheques / drafts to release the payment. Since under inventory funding dealership is havingonline account with the finance companies and within a few minutes the payment will getcredited to dealer inventory funding/trade advance account. Or otherwise, the dealer is notavailed such a inventory/trade advance facility from the bank / finance companies, then thebank/finance company will pay the amount of disbursal through cheque /demand drafts.STEP 13COLLECTION OF RC BOOK, & INVOICE COPY FROM DEALERAfter all payments are over the dealer issues RC Book & Invoice copy to customers.Babasabpatilfreepptmba.com Page 61
  62. 62. Does Maruti Finance Helps MUL increase its sales Maruti FinanceMARUTI FINANCE PARTNERS SHARE 2003-04In the year 2003-04, there were 8 partners in Maruti finance. There Market share isshown below.Fig 1 MARUTI FINANCE PARTNERS SHARE:2003-04 40% 36% 35% 30% 25% 20% 16% SALES 15% 9% 10% 9% 10% 8% 7% 5% 5% 0% MCW CMFL KMPL SFL ICICI HDFC ABN SCBKey Findings ICICI seems to be clear winner with Highest Market share of 36% , HDFC takes the second place with 16% Market Share KMPL takes the third place with 10% Market Share Rest other banks combined(MCW,CMPL,SFL,ABN,SCB) constitutes 38% of Market share.Babasabpatilfreepptmba.com Page 62
  63. 63. Does Maruti Finance Helps MUL increase its sales Maruti FinanceFig 2 MARUTI FINANCE PARTNERS SHARE 2004-05 60% 48% 50% 40% 30% SALES 21% 20% 10% 7% 6% 7% 4% 3% 4% 0% MCW CMFL KMPL SFL ICICI HDFC ABN SCBKey Findings ICICI seems to be clear winner with Highest Market share of 48% , HDFC takes the second place with 21% Market Share KMPL & MCW takes the third place with 7% Market Share Rest other banks combined (CMPL, SFL, ABN, SCB) constitutes 24% of Market share.Babasabpatilfreepptmba.com Page 63
  64. 64. Does Maruti Finance Helps MUL increase its sales Maruti FinanceFig 3 MARUTI FINANCE PARTNER SHARE 2005-06(Q1) 70% 58% 60% 50% 40% SALES 30% 22% 20% 10% 6% 6% 5% 3% 0% MCW CMFL KMPL SFL ICICI HDFCKey Findings ICICI seems to be clear winner with Highest Market share of 58% , HDFC takes the second place with 22% Market Share KMPL & MCW takes the third place with 6% Market Share Rest other banks combined (CMPL, SFL ) constitutes 14% of Market share.Babasabpatilfreepptmba.com Page 64

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