PROJECT REPORT ON

ASSET AND LIABILITIES MANAGAMENT IN

MUTHOOTH GOLD LOANS, NIZAMABAD
Project Report submitted to J awaharlal Nehru Technological
University, Hyderabad,
In partial fulfillment of the requirements for the award of the degree of
MASTER OF BUSINESS ADMINISTRATION
Submitted by:
Mr./Ms._____________________________
H.T.No._____________________________
Under the esteemed guidance of
Mr./Ms._________________________
Associate/Assistant Professor





DEPARTMENT OF BUSINESS MANAGEMENT
VIJAY RURAL ENGINEERING COLLEGE, NIZAMABAD
(Approved by AICTE, New Delhi and Affiliated to JNTU Hyderabad)
2012-2014


DECLARATION


I hereby declare that the work described in this project entitled -----------------
------------------------------------------------- carried out at ----------------------------
-------. which is being submitted by me in partial fulfillment for the award of
degree of Master of Business Administration in the Dept. of Business
Management ,Vijay Rural Engineering College , Nizamabad to the
Jawaharlal Nehru Technological University Hyderabad, Kukatpally,
Hyderabad (Telanagana.) -500 085, is the result of investigations carried out
by me under the Guidance of Mr./Ms. --------------------------------------------.

The work is original and has not been submitted in full /partial for any
Degree/Diploma of this or any other university or institution.





Place: Signature
Date:
Name of the Candidate:
Hall Ticket No.:
Email-Id:











COMPANY CERTIFICATE



























CERTIFICATE

This is to certify that the project report entitled CUSTOMER RELTIONSHIP
MANAGEMENT BIG BAZAR is being submitted by Mr./Ms.-------------------------------
(H.T.No. ------------------) in partial fulfillment for the award of the Masters Degree in
Business Administration (MBA) during the academic year 2014 to the JNTUH is a
recorded of bonafide work carried out by him/her under the guidance and
supervision.
The results embodies in this project have not been submitted to any other
university or institute for the award of any degree or diploma.

Signature of the Internal guide Signature of the HOD
( ) ( )


Signature of the External Examiner Signature of the Principal
(Dr.B.R.VIKRAM)



ACKNOWLEDGEMENT

I take this opportunity to thank all who have rendered their full support
to my work. The pleasure, the achievement, the glory, the satisfaction, the
reward, the appreciation and the construction of our project cannot be thought
without a few, how apart from their regular schedule, spared a valuable time
for us. This acknowledgement is not just a position of words but also an
account of the indictment. They have been a guiding light and source of
inspiration towards the completion of the project.
I would like to express my hearted thanks to Mr. K.Narendhar
Reddy Garu Chairman, Mrs. Amrutha Latha Garu, Secretary and Dr.
B.R.Vikram Garu, Principal- Vijay Rural Engineering College for their kind
consent to carry out this project and also providing necessary infrastructure
and resources to accomplish my project work.
I express my profound sense of gratitude to Mr.---------------------------,
Associate Professor & Head of the Department of MBA, who has kindly
permitted me to do major project in any area of my choice and providing me
all the facilities for the project.
I am deeply indebted to my project guide Mr. ----------------------------,
Assistant Professor in Department of MBA for his valuable guidance,
meticulous supervision, support and sincere advice to complete the project
successfully.
And I would like to express my sincere thanks to all the staff members
of MBA Department for their kind cooperation in completion of this project.
Finally, I thank to one and all those who have rendered help directly or
indirectly at various stages of the project and also my family members for
their care and moral support in finishing my project.
STUDENT NAME
H.T.NO
ABSTRACT






















INDEX






















LIST OF TABLES






















INTRODUCTION
Asset Liability Management (ALM) is a strategic approach of managing the
balance sheet dynamics in such a way that the net earnings are maximized.
This approach is concerned with management of net interest margin to ensure
that its level and riskiness are compatible with the risk return objectives.
If one has to define Asset and Liability management without going into
detail about its need and utility, it can be defined as simply management of
money which carries value and can change its shape very quickly and has an
ability to come back to its original shape with or without an additional growth.
The art of proper management of healthy money is ASSET AND
LIABILITY MANAGEMENT (ALM)
The Liberalization measures initiated in the country resulted in revolutionary
changes in the sector. There was a shift in the policy approach from the
traditionally administered market regime to a free market driven regime. This
has put pressure on the earning capacity of co-operative, which forced them to
foray into new operational areas thereby exposing themselves to new risks. As
major part of funds at the disposal from outside sources, the management is
concerned about RI SK arising out of shrinkage in the value of asset, and
managing such risks became critically important to them. Although co-
operatives are able to mobilize deposits, major portions of it are high cost
fixed deposits. Maturities of these fixed deposits were not properly matched
with the maturities of assets created out of them. The tool called ASSET AND
LIABILITY MANAGEMENT provides a better solution for this.
ASSET LIABILITY MANAGEMENT (ALM) is a portfolio management
of assets and liability of an organization. This is a method of matching various
assets with liabilities on the basis of expected rates of return and expected
maturity pattern
In the context of ALM is defined as a process of adjusting s liability to meet
loan demands, liquidity needs and safety requirements. This will result in
optimum value of the same time reducing the risks faced by them and
managing the different types of risks by keeping it within acceptable levels.



RBI revises asset liability management guidelines
February 6/2012In the era of changing interest rates, Reserve Bank of
India (RBI) has now revised its Asset Liability Management guidelines. Banks
have now been asked to calculate modified duration of assets (loans) and
liabilities (deposits) and duration of equity.
This was stated by the executive director of RBI, V K Sharma, and here
today. He said that this concept gives banks a single number indicating the
impact of a 1 per cent change of interest rate on its capital, captures the
interest rate risk, and can thus help them move forward towards assessment of
risk based capital. This approach will be a graduation from the earlier
approach, which led to a mismatch between the assets and liabilities.
The ED said that RBI has been laying emphasis that banks should
maintain a more realistic balance sheet by giving a true picture of their non
performing assets (NPAs), and they should not be deleted to show huge
profits. Though the banking system in India has strong risk management
architecture, initiatives have to be taken at the bank specific level as well as
broader systematic level. He also emphasized on the need for sophisticated
credit-scoring models for measuring the credit risks of commercial and
industrial portfolios.
Emphasizing on a need for an effective control system to manage risks,
he said that the implementation of BASEL II norms by commercial banks
should not be delayed. He said that the banks should have a robust stress
testing process for assessment of capital adequacy in wake of economic
downturns, industrial downturns, market risk events and sudden shifts in
liquidity conditions. Stress tests should enable the banks to assess risks more
accurately and facilitate planning for appropriate capital requirements.
Sharma spoke at length about the need to extend the framework of
integrated risk management to group-wide level, especially among financial
conglomerates. He said that RBI has already put in place a framework for
oversight of financial conglomerates, along with SEBI and IRDA. He also said
that at the systematic level efforts are being made to create an enabling
environment for all market participants in terms of regulation, infrastructure
and instruments.
NEED AND IMPORTANTS OF THE STUDY
The need of the study is to concentrates on the growth and performance of
MUTHOOT FINCORP and to calculate the growth and performance by using
asset and liability management and to know the management of
nonperforming assets.
To know financial position of MUTHOOT FINCORP
To analyze existing situation of MUTHOOT FINCORP
To improve the performance of MUTHOOT FINCORP
To analyze competition between MUTHOOT FINCORP with other
cooperatives.

SCOPE OF THE STUDY:
In this study the analysis based on ratios to know asset and liabilities
management under MUTHOOT FINCORP and to analyze the growth and
performance of MUTHOOT FINCORP by using the calculations under asset
and liability management based on ratio.
Ratio analysis
Comparative statement
Common size balance sheet.


GEOGRAPHICAL SCOPE:-
The same problem was with the all other branches of MUTHOOT
FINCORP Bank even out of the NIZAMABAD city. The management is
conducting the same research on a big ground while my contribution
is tiny. Though my sample size and geographical area was defined
and confine to a particular territory but the application of output from the
research are going to be wide.
PRODUCT SCOPE:-
Studying the increasing business scope.
Market segmentation to find the potential customers.
To study how the various products are positioned in the market.
Corporate marketing of products.
Customers perception on the various products

OBJECTIVES OF THE STUDY

To study the concept of ASSET & LIABLITY MANAGEMENT in
MUTHOOT FINCORP
To study process of CASH INFLOWS and OUTFLOWS in MUTHOOT
FINCORP
To study RISK MANAGEMENT under MUTHOOT FINCORP
To study RESERVES CYCLE of ALM under MUTHOOT FINCORP
To study FUNCTIONS AND OBJECTIVES of ALM committee.





METHODOLOGY OF THE STUDY

The study of ALM Management is based on two factors.
1. Primary data collection.
2. Secondary data collection
PRIMARY DATA COLLECTION:
The sources of primary data were
The chief manager ALM cell
Department Sr. manager financing & Accounting
System manager- ALM cell
Gathering the information from other managers and other officials of the
organization.
SECONDARY DATA COLLECTION:
Collected from books regarding journal, and management containing
relevant information about ALM and Other main sources were

Annual report of the MUTHOOT FINCORP
Published report of the MUTHOOT FINCORP
RBI guidelines for ALM.






LIMITATION OF THE STUDY
This subject is based on past data of MUTHOOT FINCORP
The analysis is based on structural liquidity statement and gap analysis.
The study is mainly based on secondary data.
Approximate results: The results are approximated, as no accurate data is
Available.
Study takes into consideration only LTP and issue prices and their difference
for Concluding whether an issue is overpriced or under priced leaving other.
The study is based on the issues that are listed on NSE only.

ASSET LIABILITY MANAGEMENT (ALM) SYSTEM:-
Asset-Liability Management (ALM) can be termed as a risk management
technique designed to earn an adequate return while maintaining a comfortable
surplus of assets beyond liabilities. It takes into consideration interest rates,
earning power, and degree of willingness to take on debt and hence is also
known as Surplus Management.
But in the last decade the meaning of ALM has evolved. It is now
used in many different ways under different contexts. ALM, which was
actually pioneered by financial institutions and banks, are now widely being
used in industries too. The Society of Actuaries Task Force on ALM
Principles, Canada, offers the following definition for ALM: "Asset Liability
Management is the on-going process of formulating, implementing,
monitoring, and revising strategies related to assets and liabilities in an attempt
to achieve financial objectives for a given set of risk tolerances and
constraints."

Basis of Asset-Liability Management
Traditionally, banks and insurance companies used accrual system of
accounting for all their assets and liabilities. They would take on liabilities -
such as deposits, life insurance policies or annuities. They would then invest
the proceeds from these liabilities in assets such as loans, bonds or real estate.
All these assets and liabilities were held at book value. Doing so disguised
possible risks arising from how the assets and liabilities were structured.









REVIEW OF LITERATURE
Paper Title:-Sovereign Risk and Asset and Liability
Management Conceptual Issues (SRALM)
Authour:- G. Papaioannou, and Author I va Petrova(2000)
Findings:- Country practices towards managing financial risks on a sovereign
balance sheet continue to evolve. Each crisis period, and its legacy on
sovereign balance sheets, reaffirms the need for strengthening financial risk
management. This paper discusses some salient features embedded in in the
current generation of sovereign asset and liability management (SALM)
approaches, including objectives, definitions of relevant assets and liabilities,
and methodologies used in obtaining optimal SALM outcomes. These
elements are used in developing an analytical SALM framework which could
become an operational instrument in formulating asset management and
debtor liability management strategies at the sovereign level. From a portfolio
perspective, the SALM approach could help detect direct and derived
sovereign risk exposures. It allows analyzing the financial characteristics of
the balance sheet, identifying sources of costs and risks, and quantifying the
correlations among these sources of risk. The paper also outlines institutional
requirements in implementing an SALM framework and seeks to lay the
ground for further policy and analytical work on this topic.JEL
Paper Title: - Integrating Asset-Liability Risk Management with
Portfolio Optimization for Individual Investors II (IALRM)
Author: - Travis L. Jones, Ph.D.(2002)
Findings: - A majority of private client practitioners rely on mean-variance
optimization (MVO), rules of thumb, or model portfolios for making asset
allocation recommendations. Considerations for income levels and other
constraints figure into the typical approach. However, not enough attention is
given to the nature of an investors multiple time horizons and implications for
cash flows. These are the future demands placed upon the portfolio. The risks
that these demands will not be met need to be clearly understood in order to
validate any asset allocation decision. This study presents an approach of
incorporating MVO within a multi-horizon, asset-liability Management risk
model. This approach allows for cash-flow matching of a portion of an
investors portfolio within the optimization framework. This allows an
individuals portfolio to provide short-term cash flow, as needed, while also
considering the longer-term demands on the portfolio.
Part Title: - Asset & liability management (ALM) modeling with risk
control by stochastic dominance.
Author name: - Xi Yang, Jacek Gondzi & Andreas Grothey(2001)
Findings:-An Asset Liability Management model with a novel strategy for
controlling the risk of underfunding is presented in this article. The basic
model involves multi-period decisions (portfolio rebalancing) and deals with
the usual uncertainty of investment returns and future liabilities. Therefore, it
is well suited to a stochastic programming approach. A stochastic dominance
concept is applied to control the risk of underfunding through modeling a
chance constraint. A small numerical example and an out-of-sample back test
are provided to demonstrate the advantages of this new model, which includes
stochastic dominance constraints, over the basic model and a passive
investment strategy. Adding stochastic dominance constraints comes with a
price. This complicates the structure of the underlying stochastic program.
Indeed, the new constraints create a link between variables associated with
different scenarios of the same time stage. This destroys the usual tree
structure of the constraint matrix in the stochastic program and prevents the
application of standard stochastic programming approaches, such as (nested)
Benders decomposition and progressive hedging. Instead, we apply a
structure-exploiting interior point method to this problem. The specialized
interior point solver, object-oriented parallel solver, can deal efficiently with
such problems and outperforms the industrial strength commercial solver
CPLEX on our test problem set. Computational results on medium-scale
problems with sizes reaching about one million variables demonstrate the
efficiency of the specialized solution technique. The solution time for these
non-trivial asset liability models appears to grow sub linearly with the key
parameters of the model, such as the number of assets and the number of
realizations of the benchmark portfolio, which makes the method applicable to
truly large-scale problems.














PROFILE OF INDUSTRY & COMPANY
Muthoot Finance Ltd. is the largest player in the gold loan business in
India. 76% of its business is generated from the 5 southern states in the
Country. The Company has a market share of 19.5% in the organized sector as
on FY10. It is facing major legal hurdle related to Kerala State Money lender
Act which, if implemented will substantially reduce the profitability of the
Company as Kerala accounts to 24% of Companys business. Moreover, there
is a good probability for gold price to get corrected after this prolonged bull
run which may reduce the ticket size of the loans, leading to a drop in growth
and associated profitability. We are quite bullish on the growth potential of
this firm but we would like to avoid the scrip until the abovementioned factors
are sorted out and the scrip is available at a deep discount.
INTRODUCTION OF THE MUTHOOT FINANCE LTD
Incorporated in 1997, Muthoot Finance Ltd. is Indias largest gold loan
Company. It is a subsidiary of Muthoot Group which is headquartered at
Kochi, India. It provides 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. It has the largest branch network among gold loan providers in
India with 1921 branches and a strong presence in the underserved rural and
semi-urban markets. In 2010, it received a fund infusion of Rs.250 cr. from
private equity players like Baring India Private Equity, Matrix Partners India,
Kotak India Private Equity Fund and Well come Trust for a 6% stake in the
Company. In 2011, well comes Trust picked up an additional 1% stake from
the promoters, taking the total stake of private equity investors to 7%.


HISTORY - MUTHOOT FINANCE LTD

Our Company was originally incorporated as a private limited
company on March 14, 1997 with the name The Muthoot Finance Private
Limited under the Companies Act. Subsequently, by fresh certificate of
incorporation dated May 16, 2007, our name was changed to Muthoot
Finance Private Limited. The Company was converted into a public limited
company on November 18, 2008 with the name Muthoot Finance Limited
and received a fresh certificate of incorporation consequent upon change in
status on December 02, 2008 from the RoC.
Merger with Muthoot Enterprises Private Limited Our Company, along
with Muthoot Enterprises Private Limited, filed a composite scheme of
arrangement bearing C.P. Nos. 48 and 50 of 2004 under the Companies 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 board resolution dated April 28, 2004.
Pursuant to the approval of the Scheme of Amalgamation by the High
Court of Kerala by an order dated January 31, 2005, Muthoot Enterprises
Private Limited was merged with our Company, with effect from March 22,
2005 and the High Court of Kerala had instructed all the parties to comply
with the statutory and other legal requirements to make the Scheme of
Amalgamation effective.

The company on March 22, 2005 filed a certified copy of the order of
the High Court of Kerala with the RoC. With the successful implementation of
the Scheme of Amalgamation, the undertaking of Muthoot Enterprises Private
Limited along with its assets and liabilities was transferred to and vested in
our Company.



KEY EVENTS, MILESTONES AND ACHIEVEMENTS YEAR
1. 2001 RBI license obtained to function as an NBFC.
2. 2004 Obtained highest rating of F1 from Fitch Ratings for short term debt
of Rs. 200 million.
3. 2005 Retail loan and debenture portfolio of the Company exceeds Rs. 500
million.
4. Merger of Muthoot Enterprises Private Limited with the Company
5. 2006 F1 rating obtained from Fitch Ratings affirmed with an enhanced short
term debt of Rs. 400 million.
6. 2007 Retail loan portfolio of the Company crosses Rs. 10 billion.
7. RBI accords status of Systemically Important ND-NBFC.
8. Branch network of the Company crosses 500 branches.
9. Net owned funds of the Company crosses Rs. 1 billion.
10. 2008 Net owned funds of the Company crosses Rs. 2 billion.
11. Retail loan and debenture portfolio crosses Rs. 20 billion and Rs. 10
billion respectively.
12. F1 rating obtained from Fitch Ratings affirmed with an enhanced short
term debt of Rs. 800 million.
13. Overall credit limits from lending banks crosses Rs. 5 billion.
14. Conversion of the Company into a public limited company.
15. Fresh RBI license obtained to function as an NBFC without accepting
public deposits, consequent to change in name.
16. 2009 Retail loan and debenture portfolio crosses Rs. 30 billion and Rs. 15
billion respectively.
17. Net owned funds of the Company crosses Rs. 3 billion.
18. Gross annual income crosses Rs. 5 billion.
19. Overall credit limits from lending banks crosses Rs. 10 billion.
20. 2010 Retail loan and debenture portfolio crosses Rs. 50 billion and Rs. 20
billion respectively.
21. Net owned funds of the Company crosses Rs. 4 billion.
22. Overall credit limits from lending banks crosses Rs. 20 billion.
23. ICRA assigns A1+ rating for short term debt of Rs. 2 billion.
24. CRISIL assigns P1+ rating for short term debt of Rs. 4 billion.
25. Branch network of the Company crosses 1,000 branches.
26. Demerger of the FM radio business into Muthoot Broadcasting Private
Limited.
27. Private equity investment of an aggregate of Rs. 1,575.45 million from
Matrix Partners India Investments, LLC and Baring India Private Equity Fund
III Limited.

BACKGROUND - MUTHOOT FINANCE LTD
Muthoot finance is a flagship company of the Muthoot Group based in
Southern India. The group has a presence in diverse businesses including
financing, healthcare, real estate, education, hospitality, forex, wealth
management services, money transfer services, power generation and
entertainment.
Muthoot Finance Ltd (MFL), incorporated in 1997, is the Kerala based
largest gold financing company in India in terms of loan portfolio. The
company offers gold loan to individuals like small businessmen, vendors,
traders, and salaried individuals who cannot access formal credit for reasons
like lack of credit history, documentation, accessibility. The company
generally gives small ticket loans (average ticket size of ~`31000) with a tenor
not exceeding one year, thereby limiting interest risk and asset-quality
concerns. The loan-to-value varies from 60%-85%. Muthoot Finance Gold
Loan portfolio as of November 30, 2010 comprised approximately 4.1 mn
loan accounts in India which it serviced through 2263 branches across 20
states. The company has further increased its branch network to 2611 branches
as of February 28, 2011, servicing an average of 67,953 customers per day in
the month of February 2011. As of February 28, 2011, the company has
employed 15,664 persons. Other then Gold Loans business, the company
provides money transfer services through their branches as sub-agents of
various registered money transfer agencies.
PRODUCT AND SERVICES OF THE MUTHOOT FINANCE
1. GOLD LOAN

Muthoot Finance, Indias largest gold loan company is the first choice of
Indians who want to make their dream a reality. May the dream be to start
their own business or to buy their own home, for over 124 years Muthoot
Finance has helped almost every Indians dream come true. Trusted by over
70000 customers every day, Muthoot Finance Gold Loan has services and
products that fit the need of any customer, making it the quickest, most
convenient and safest way to take a gold loan.
Key features of Gold Loan:
Loan disbursal in 5 minutes
Loans starts from 1,500 to 1 Crore
Minimal documentation and credit assessment requirements
High quality customer service in short response time
Evaluation 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
India
0% processing fees
Pre-payment option-without any penalty

GOLD LOAN SCHEMES
Scheme Name Value (per gram) Interest (% p.a.)
True Value Personal Loan (TPL) Rs. 1,035/- 12%
Super Value Personal Loan (SPL) Rs. 2,260/- 24%
Real Value Personal Loan (RPL) Rs 1,960/- 18%
Express Personal Loan (XPL) Rs. 2,090/- 21%

2. GOLD COINS
Now invest your wealth in the ever rising power of Gold with the Muthoot
Precious Metals Corporation. 24 carat Pure Gold Coins: Muthoot Precious
Metals Corporation presents Gold Coins with 999% purity (24 Carat). Invest
in safe, secure and profitable Gold Coins.
The Gold Coins hold many advantages:
999% pure
Finance schemes with easy monthly installments
Appreciating asset
Higher return on investment with no risks
Available in denominations such as 2g, 4g, 8g, 20g and 50g to suit
every pocket.
The ideal gift for your near and dear ones
Silver Coins
999% pure Silver Coins
One of India's few financial players that deals in Silver Coins
Available in 50 gm and 100 gm
Available at over3, 000 Muthoot Finance brances across India

3. MONEY TRANSFER
One of the finest Money Transfer services in India, with over 700,000
transfers annually, Muthoot Money Transfer is the largest payout centre in
India. Muthoot Money Transfer allows real time money transfers from across
the seas, with the money reaching the receiver in less than 10 minutes. The
money can be transferred from First Remit/Coinstar, Xpress Money, Ez
Remit, Money Gram, Royar Money, Global Money Transfer, Western Union,
Transfast, Instant Cash and even Muthoot Finances own branches abroad.
The service boasts low costs, high exchange rates and NO additional service
charge to the receiver.
The key highlights of this service are:
Fastest Money Transfer facility
No bank account needed for amounts up to Rs. 50,000
The receiver does not have to pay any service charge
Certified by the RBI
Access it in any of the 3000 branches across the country


4. FOREIGN EXCHANGE
Muthoot Foreign Exchange offers you currency exchange facilities as well as
allows you to buy and sell foreign currency and Travellers cheques with
Muthoot Foreign Exchange service. With the wide network of almost 3000
branches, we ensure ease of transaction. Muthoot Foreign Exchange helps you
get competitive rates for all currencies and notes in 35 major currencies as
well as 100 miscellaneous ones!
A few features of our Foreign Exchange service:
Buying and selling of all major Travellers cheques and Travel Cards
Commission free encashment of Travellers cheques
Competitive rates for all currencies
Remittance of funds abroad for various purposes

5. MPOWER CARD
Your life is made infinitely easier with the Muthoot MPower Card, which is
a unique identity card with numerous benefits:
Access it anywhere in India
Earn Loyalty Points on every transaction at ANY Muthoot branch
Redeem these Loyalty Points for attractive gifts
Get Rs. 20 per gram extra on Gold Loan
Keep all your jewelry in our lockers free of cost (No locker charges!)
Rs. 50,000 Personal Accident Insurance coverage
Deposit and withdraw money from any branch on Real Time
Special overdraft scheme for MPower Cardholders.

6. TRAVEL SMART
Within just a few months of its launch Muthoot Travel smart has already
become one of the leading IATA (International Air Transport Association)
accredited agencies and has got certified by IRCTC. Muthoot Travel smart
offers all the services of a travel agency and more, such as travel insurance
and foreign exchange Muthoot Travel smart carries forward the groups core
values of helping India make the right decision with their money by helping
you during your travels, both familial and official. In addition to the 3000
branches of Muthoot Finance in India, the services of Muthoot Travel smart
can be accessed in 6 offices overseas as well.
The services offered under Travel smart include:
International & Domestic Ticketing
Railway Ticketing
Tours
Passport, Emigration & Visa
Travel Insurance


VALUE ADDITION IN PRODUCT AND SERVICES OF THE
MUTHOOT FINANCE LTD
We have challenged ourselves to perform better than the best. We have
now launched a new venture in Gold Financing, offering Customers loan
against the security of Gold Exchange Traded Funds (ETFs) units. This will
not only add value to the services but also enable the Company to service
financial requirements of new Customer segment.
The visionary zeal, constant innovation and customer-oriented product
& service delivery deployed at every phase of its growth are indeed
exemplary. And Muthoot Group is now all set to go places, backed by its
assets built by extraordinary people and high values.
With the guiding principles of honesty, sincerity, confidence and service,
Muthoot Group has indeed come a long way. These values continue to drive
all business decisions of the Group Companies. With customer-centric
products and services to offer, the Group has been constantly innovating and
evolving to deliver superior products, transparent workplace practices, easy
accessibility and personalized services at all levels. Perhaps why, Muthoot
Group has earned the trust of millions of customers and associates across the
country.
1. Muthoot Finance launches new gold loan scheme

Indian non-banking finance company (NBFC) Muthoot Finance Ltd
Friday announced the launch of a new gold loan scheme that will provide
loans to public against the security of Gold Exchange Traded Fund (ETF)
across the country.
The new scheme Gold ETF Loan Scheme which will be made
available to the customers by July-end 2011 will help customers get loan
against their Gold ETF units to the extent of 85% of the net asset value (NAV)
of ETFs, said a press release issued by Muthoot Finance.
Gold ETFs are mutual fund units issued by Asset Management
Companies against 995 purity physical gold. They are listed and traded on
stock exchanges and can be bought and sold like stocks on a real-time basis.
Gold ETFs were valued at Rs 50 billion as of June 2011.
Loan against Gold ETF is a scheme through which Muthoot Finance
plans to venture into totally new segment of gold financing which would not
only add value but also enable the company to service the financial
requirements of newer customer segments, said George Alexander Muthoot,
managing director of Muthoot Finance during the launch.

2. MUTHOOT FINANCE LAUNCHES THE WESTERN
UNION

MONEY TRANSFER
SM
SERVICE:
May 27, 2011, Kochi, India: International money transfer consumers across
Kerala - Indias foremost remittance driven economy will now be able to
receive their Western Union Money TransferSM transactions from Muthoot
Finance - a leading Kerala based financial institution.
Muthoot Finance will now offer Western Union Money Transfer
services from its countrywide network of 2800 locations linking them to
Western Unions network of more than 400,000 locations in over 200
countries and territories across the world.
Launching the service, Mr George Alexander Muthoot Managing
Director, Muthoot Finance Ltd said, Here, on this occasion, three of the
biggest players of the Indian Financial Services industry have come together
with the intention of providing a premium money transfer service to customers
across the country.
Muthoot Finance Ltd., through its extensive network of branches, aims
to capitalize the huge potential of the money transfer business in India.
With its expansive global network, Western Union is uniquely
positioned to deliver fast, reliable and convenient money transfer services to
consumers across remote geographical locations globally.
Through our agreement with Western Union we have facilitated a
number of classes of trade including retail and banks to offer Western Union
Money Transfers services to the remotest corners of India. The collaboration
with Muthoot Finance is one more step in this direction which would
positively impact people across the 2,800 branches offering the service,

History of GOLD loan
Gold is a brilliant yellow precious metal that is resistant to air and water
corrosion. It is a very soft and pure metal. Gold is the most malleable and
ductile metal found on earth. Thats why it is expensive and it is alloyed with
other metals, usually copper and silver to make it less expensive and harder, a
karat is the unit that measures the purity of gold jewellery or else it is
hallmarked with a three digit number that indicates the parts per thousand of
gold. Some countries hallmark gold with a three digit number that indicates
the parts per thousand of gold. The alloyed gold comes in many colours and
may not be bright yellow all the time. It has long been a values commodity,
particularly in India where it is considered auspicious, and had been in use for
centuries in the form of jewellery, coins, bullions, electronics, and dentistry,
also for other medical purposes. Though gold is a highly liquid asset, it wasnt
until recently that consumers leveraged it effectively to meet their liquidity
needs.
Lenders provide loans by securing gold assets as collateral. Compared with the
rest of the world in India the gold loan market is big business. Until a decade
back, most of the lending was in the unorganized sector through pawnbrokers
and money lenders. However this scenario changed with the entrance of
organized sector players such as banks and non banking finance companies
(NBFCs) which now command more than 25% of the market. The organized
gold loan market has grown at 40% CAGR form 2002 to 2010. NBFCs have
been a major driving force behind this growth given their extensive network.
Faster turnaround time, higher loan to value ratios and the ability to serve non-
bankable customers. Of late, banks have improved their gold loan product
features and services. Coupled with comparatively lower interest rates
charges, bank stand to gain market share at the expanses of NBFCs in the near
future.
The eligibility criteria required to apply for gold lone in India includes three
factors. Firs-tly, the person has to be above 18 years of age. Secondly, the
person applying or a gold loan in India should have a ID & address proof and
last but not the least the applicant should be working on a regular salary basis ,
means there should be a constant flow of income.
BACKGROUND: GOLD AND THE INDIAN SOCIETY
Gold has traditionally been among the most liquid asset and is an accepted
universal currency. it has traditionally been consumed by individuals in the
form of jewellery, especially in India were it is considered auspicious. Gold is
presumed to be a safe haven in times of economic uncertainty, a fact
exemplified by a 30% increases the value of gold over the past year India is
one of the largest market of gold accounting for approximately 10% of the
total world gold stock as of 2010. Rural India accounts for 65% of this gold
stock. Though gold price have increased 19% CAGR from 2002 to 2010, gold
stock in India has grown at 22% CAGR During the same period to 18000 tons
(Rs.32000 billion). The demand for gold has followed a regional trend with
southern India accounting for 40% of annual demand, followed by the west
(25%), north (20-25%) and east (10-15%).
Looking for Gold Loan Market
The Key Players in the Indian gold loan market include the unorganized
sector, banks _ public/private/cooperatives and NBFCs. While the
unorganised sector, comprising local pawnbroker and money leader has
traditionally dominated the gold loan market for money decades and still
commands nearly 75% of the market the organized sector led by NBFCs is
catching up fast. The organized sector has grown at rapid paces of 40% CAGR
form the 2002 to 2010 and is expected to grow by 33% to41% CAGR in 2011
And in doing so these companies are challenges the dominance of the large
unorganized sector within the organized sector, NBFCs have grown at a repaid
rate from 18.4% in FY to 32.2% in FY10. (Source: cognizant 20-20 insight
jan.2012)
Muthoot finance
With a tagline loan in just 5 minutes muthoot fiancs is a Indias largest gold
loan company & is the fast choice of Indian who want to make their dream a
reality. May the dream be to start their own business or to buy their own
home: muthoot finance has helped almost every Indians dream come true,
trusted by over 76000 customer every day muthoot finance gold loan has
services and products that fit the need of any customers, making it the quickest
,most convenient and safest way to take gold loan
Headquartered in the southern Indian state of Kerala, their operating history
has evolved over a period of 72 since M George muthoot (the father of our
promoter) founder a gold loan business in 1939 under the heritage of a
treading business established by his father, ninan mathai muthoot in 1987.
since our formation, we have broadened the scale and geographic scope of
their retail leading operation so that, as of march 31, 2008, 2009, 2010, 2011
and in the period ended September 30, 2011 revenue from their gold loan
business constituted 95.97% 96.71% 98.08% 98.75% and 99.01% respectively
, of their total income,