1 Autoinvest Leasing and Finance (I) Private Limited mfR4 Analytical Contacts Mr. Ramraj Pai Director [email protected]+91 22 3342 3036 Mr. T Raj Sekhar Sr. Manager [email protected]+91 44 66563136 Microfinance Institution Gradings Date Assigned October 12, 2010
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ABOUT THE MFI Lending model : Group based lending model
Products : • Joint Liability loan with loan size ranging from Rs.8,000–Rs.25,000 per member. The MFI currently extends 50 week loans at an interest rate of 27 per cent on reducing basis.
Borrower base : 2690 borrowers as on August 31, 2010
Employees : 147 (95 credit officers) as on August 31, 2010
Number of branches : 9 as on August 31, 2010
Loan outstanding : Rs.31.9 million as on August 31, 2010
Loans disbursed : Rs.33.6 million during the 2 months ending August 31, 2010.
Operational areas : Nine districts (Eight districts in Tamil Nadu and One district in Karnataka) as of August 31, 2010
OUTREACH SUMMARY
Particular Aug-10 No. of groups 538
No. of members 2690
No. of borrowers 2690
No. of branches 9
No. of districts covered 9
Women borrowers 100%
Disbursements (Rs.million) 33.6
Loan outstanding (Rs.million) 31.9
PRODUCTIVITY AND EFFICIENCY INDICATORS
As on/For the period ending, Aug-10 Members/branch (No.) 299
Borrowers/ branch (No.) 299
Loan outstanding/branch (Rs.million) 3.5
Loan outstanding/ credit officer (Rs.million) 0.3
Loan outstanding/ borrower (Rs.) 11859
Members / credit officer (No.) 28
Borrowers / credit officer (No.) 28
Groups / credit officer (No.) 6
Borrowers/members (%) 100
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Social Indicators and Transparency Indicators
As on August 31, 2010 Average loan outstanding/per capita GNI (2009 figure)* (in %) 32.6 Women staff/total staff (in %) 0.7 Women borrowers/total borrowers (in %) 100 Effective IRR (including interest rates, processing fees, security deposit & any other fees charged by the organisation)? (in %) 30.2 Are interest rate (on declining basis) communicated to clients in writing? Yes Are processing charges communicated to clients in writing? Yes Is an official receipt provided by the MFI to clients after repayment collections? Yes Is access to loan of other MFIs one of the parameters to select/screen clients? Yes Is access to loan of other MFIs/residual income one of the factors to appraise repayment paying capacity of clients? Yes Does the MFI appraise the client's income/poverty/asset level and use it to target low income clients? Yes Does the MFI capture and analyse reasons for client drop out rate? Yes Is any head office designated contact details provided to clients as part of grievance redressal mechanism offered to clients? Yes
*Per capita GNI is based on current prices. Source: CCER computations based on Central Statistical Organisation (CSO) data
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GRADING RATIONALE
The microfinance institution (MFI) grading assigned to Autoinvest Leasing and Finance (I)
Private Limited (Vistaar) reflects the MFI’s:
� Experienced board and senior management team
� Commitment to implementation of strong processes and systems
� Adequate capitalisation
The above-mentioned grading strengths are partially offset by Vistaar’s:
� Short operating track record
� Asset quality and credit risks untested through a full business cycle
� Modest expected earnings profile over next two years
PROFILE
Autoinvest Leasing and Finance (I) Private Limited is a non-deposit-taking non-banking
financial company (NBFC-ND) registered as a loan company with the Reserve Bank of
India (RBI). The company was incorporated in September 1991. The present promoters
acquired this company in March 2010 and have applied for the name change to Vistaar
Livelihood Finance. The company started its microfinance operations on June 17 2010, and
has since expanded to nine branches—eight in Tamil Nadu and one in Karnataka. As on
August 31, 2010, the company had 2690 borrowers and loans outstanding of Rs.32 million.
Mr. Brahmanand Hegde, former director – microfinance, Fullerton India Credit Company
Ltd (FICC) and Mr. Ramakrishna Nishtala, former head – microfinance, FICC are the core
promoters of the company. Mr. G S Sundararajan, managing director, Shriram Capital Ltd,
and former chief executive officer and managing director of FICC, is also a significant
shareholder. The three promoters together hold 55 per cent of the company’s stake. The
other shareholders include Elevar Equity (22.5 per cent stake), the equity fund manager of
Unitus Capital and SVB India Capital Partners, a venture fund (22.5 per cent).
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Vistaar’s mission is to make a significant and sustainable impact on the lives of under-
served entrepreneurs, across rural and urban India, by enhancing the economic output of
their livelihoods. The company’s vision is to provide customised financial services and
other value-added enablers, focused on customers’ livelihoods, in a transparent and
innovative manner.
Loan Methodology and Product Offerings
*To be introduced shortly **Tie-up with Kotak Mahindra Old Mutual Life Insurance Ltd.
Vistaar’s lending model is similar to the Grameen Bank model. Vistaar offers loans to
women organised into joint liability groups (JLGs). Currently, the company offers only one
loan product, which is differentiated by the loan amount (refer to Table 1). In the near future,
the MFI aims to offer larger-ticket customised loan products with repayment flexibility.
Such loans will be focussed on livelihood activities such as dairy, power loom, handloom,
1.1 Loan purpose-wise outstanding as on August 11, 2010 ................................................21 1.2 Human resource summary ..............................................................................................21 1.3 Asset quality .....................................................................................................................21
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1.1 Loan purpose-wise outstanding as on August 11, 2010
Rs.million
Purpose Amt ( % Dairy 1.1 7.67
Powerloom 0.6 4.52
Handloom 0.3 2.09
Artisan 0.3 1.92
Fruits / Veg / Flower / Coconut 0.8 5.85
Hotel / Tea / Snacks 0.4 2.70
Kirana / Other Shop 1.5 10.78
Tailoring 0.8 5.53
Home Based Enterprise 0.8 5.46
Farm based 3.6 26.14
Other Livestock 0.8 5.77
Others 3.0 21.58
Total 13.8 100
1.2 Human resource summary
Particular Aug-10 No. of total employees 147
No. of employees added during the year 174
No. of total employees left during the year 18
No. of branch employees 126
No. of credit officers 95
1.3 Asset quality
Rs.million
As on, Aug-10 Total outstanding balance associated with loans that are PAR % of PAR On time 31.9 100