Asia Asset Finance moves ahead with a steep growth trajectory
Asia Asset Finance PLC (AAF), a licensed finance company, is now on a steep growth trajectory after the company’s tie up with Muthoot Finance a 128 year-old, Indian family-owned firm, an official at the helm of the company said.
A large number of Small and Medium Enterprises (SMEs) and micro business enterprises across the country have been helped by AAF funding as more businesses take advantage of the options that asset finance can make available to support growth and stability.
The strategy for the next two quarters of the financial year is to continue to hold this momentum which would see AAF being pushed to the top 10 finance companies in the industry, he said.
The expertise, the reputation and the clear implementation has enabled AAF to have a rapid uptrend in the market. This has enabled AAF to be more innovative with the products and as the company practice has been for the last five years to introduce unique products to the market.
The company is currently in the process of restructuring its leasing and hire purchase products to face the competition from other sectors. It will also introduce money transfer operations currency exchange services and insurance related services. This asset finance lender has recorded strong growth countrywide with its regional branches numbering 16 as it increased the asset base to Rs.10 billion during 2016/17 from Rs.8.1 billion in the previous year posting Rs.2 billion interest income and Rs. 275 million post-tax profit, Rajiv Gunawardena, Chief Executive Officer (CEO) of AAF told the Business Times.
Revenue grew by 68.14 per cent to Rs.2.13 billion while net income improved 58.69 per cent to Rs. 278.05 million. The introduction of gold loans and the expansion of its micro finance portfolio as well as asset financing for SMEs have been the key contributors to this year’s growth, Mr. Gunawardena said. The company has introduced a unique product to cater to the needs of the SME sector which has been the key contributor to the success of its performance during the 2016/17 financial year. This product is combined with value additions to SMEs with technological support, knowledge sharing forums and management assistance. The company has seen a 70 per cent growth in its gold loan business in the country–enjoying the patronage of a good chunk of people in the North and East, he revealed.
Gold loan business has been introduced in all 16 branches of AAF and is gradually picking up, he disclosed. “The tie up with Muthoot Finance has enabled AAF to secure low cost diversified funding lines on top of the increasing customer deposit portfolio. The strength in the treasury has enabled AAF to be more creative with the products being offered and also make products more flexible to cater to a bigger demographic,” he disclosed.