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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=17/31/2019 Mathoot Pro. Rakha Jatev
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