Gold loan business in Gujarat is picking up pace making more and more companies to increase their presence in the state. Kerala-based leading gold loan provider, Manappuram Finance Limited is expanding is branch network in Gujarat from current 70 branches across the state to about 100 by end of fiscal 2012.
"We are expanding our branch network across the country, we are also looking at increasing our presence in the western market. Gujarat is an important market for us and we will increase our branches in the state in tier-2,3 towns during this fiscal," said I Unnikrishnan, MD, Manappuram Finance.
Western region, including Gujarat and Maharashtra contributes about 7 per cent to the company's total gold loan portfolio, while largest share comes from southern market, about 74 per cent. The acceptability of gold loan is rising in Gujarat. "Gujarat's share to our total loan portfolio has been meagre at about 2 per cent, which is expected to rise to 5 per cent in some time," he added.
Further he mentioned that with rise in gold price, the amount of loan that one can avail on the security has also increased. Over the past one year, gold prices have jumped from Rs 19,100 per 10 gram to Rs 26,000 per 10 gram at present. "Currently, our gold loan portfolio stands at about Rs 9,000 crore, which is expected to rise to Rs 13,000 crore by March 2012. Major growth to come from southern markets. We are planning to open 100 more branches across India this fiscal," said Unnikrishnan.
Manappuram witnessed a 120 per cent rise in its gold loan disbursements during the quarter ended June 2011 at Rs 6,858 crore from Rs 3,111 crore registered in the quarter ended June 2010.