To provide support in opening new branches of

Chola with the help of necessary legal

documents and finance for managing the assets.
To assist the marketing team for raising
awareness of Chola VF among truck dealers,
brokers and drivers through integrated
marketing solutions.

Report
By
Madhurh Malhotra (PGDM)
Work carried out at Cholamandalam Investment and
Finance Company Limited, Chennai

Submitted in partial fulfilment of the requirement of

Summer Internship Program

Under the Supervision of

Major --------------------Assistant Vice President and Head of InfrastructureChola
&
Mr -------------Manager-Business Development and Marketing
------------------------Indian Institute for Management Development
Bangalore, Karnataka, India
(June 2012)
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Company Letter Head

CERTIFICATE
This is to certify that
Mr/Ms____________________________________
currently studying Post Graduate Diploma in Management
at Indian Institute for Management Development,
Bangalore has satisfactorily completed Summer Internship
project titled
___________________________________________________________

Related to _________________stream of Management from

__________to ________ .

Signature:

Date:

Name:

Place:

Designation:

Name of the Organisation and Address:

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CERTIFICATE BY THE FACULTY GUIDE, INDIAN

INSTITUTE FOR MANAGEMENT DEVELOPEMNT,
BANGALORE

This is to certify that Roll No__________ Mr/Ms

______________________
Of PGDM Batch 2010-12 has satisfactorily completed Summer
Internship Project titled
__________________________________________________________

at M/S____________________________________________________
located at _________________ from _______________ to
______________ to partially fulfil the requirements of the PGDM
program under my guidance.

Signature:

Date:

Name:
Designation:
Indian Institute for Management Development, Bangalore

Institutional Stamp

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Acknowledgement
I take the opportunity to express my deep gratitude to Mr.
Kumaresh (Assistant Vice President-HR) for giving me an
opportunity to do my internship at Cholamandalam Investment
and Finance Company Limited belonging to the Murugappa
Group.
I am thankful to Major Pradeep Kumar Menon (Assistant vice
President and Head of Infrastructure, Cholamandalam) for
letting me do a Finance project in the Project Infrastructure
department and my sincere appreciation to his team members:
Mr M.A.Kattiresan, Mr V.Srinivasan, Mr. Anbarasan, Mr
Balachander,
Mr
Ramesh,
Mr
Shivanesan
and
Mr
Anandhaprabhu for their continuous guidance and providing me
immensely valuable inputs.
I am also thankful to Mr Sundar P (Sr. Manager-Marketing
Communication) and Mr Vignesh Murali (Manager-Business
Development and Marketing) for letting me do a Marketing
project in the field of Integrated Marketing Solutions.
Sincere appreciation is extended to Dr Mousumi Sengupta, the
internal faculty guide of IMD, for providing me with necessary
guidance for efficient execution of the project.
This opportunity was a great learning experience, which would
not have been possible without the support from the
management of IMD and I am indebted to them.

Vishal Malhotra

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Executive Summary
Dissertation Title: Cost Effective setting up and Branding
Branches of Chola
Supervisors: -------------------------Name: Vishal Malhotra
PGDM No: -----------Cholamandalam Investment & Finance Company Limited
(CIFCL) provides financial services that include vehicle finance,
corporate finance, home equity loans, stock broking and
distribution of financial products to its customers.
The Infrastructure Department of CIFCL is in charge of all the
structuring of the existing and new branches by taking
responsibility of preparing the necessary legal documents
related to the property and also providing the necessary assets
via requests from respective branch managers. The department
is responsible for preparing the required Comparison
Statements and the Capital Expenditure Proposals and then
forwarding the proposals to the Finance Department and the
Chief Financial Officer (CFO) for their approval.
The Integrated Marketing Solutions is to do with how various
marketing methodologies are implied round the clock that a
customer experiences in his/her day to day life and gets
attracted
towards
the
brand
being
marketed.
The
methodologies including the various forms of media,
telecommunication companies, billboards and so on.
Signature of the Student
Vishal Malhotra
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Signature of Project Guides

----------------------------------------------------------(Assistant Vice President & Head-Infra)
(Manager-Marketing)

List of Abbreviations Used:

CIFCL: Cholamandalam Investment and Finance Company
Limited
CDSL: Cholamandalam Distribution Services Limited
CSec: Cholamandalam Securities Limited
VF : Vehicle Finance
GL : Gold Loan
CF : Corporate Finance
HE : Home Equity
BM : Branch Manager
AM : Area Manager
BH : Business Head
NBM : National Business Manager
ALM : Area Legal Manager
SRO : Sub Registered Office
CAPEX : Capital Expenditure Proposals
PO : Purchase Order
AUM : Asset Under Management
PAT : Profit After Tax
ROTA : Return on Total Assets

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Contents
Acknowledgement.....................................................................5
Executive Summary................................................................... 6
List of Abbreviations Used:........................................................7
Chapter 1 Introduction............................................................10
1.1 Brief Profile of the Head of the Company........................10
1.2 Major Companies............................................................12
1.3 Brief Profile about CIFCL..................................................13
1.4 Journey of Chola..............................................................15
1.5 Values and Beliefs...........................................................16
1.6 Products of CIFCL............................................................17
Chapter 2 Stages for setting up a Branch................................20
2.1 Stage 1- Identification of Branch and Documents...........20
2.2 Stage 2- Scrutinising and Forwarding of Documents.......21
2.3 Stage 3- Role of Financial Analyst...................................22
2.4 Stage 4 Security Deposit and Rent Allocation...............23
2.5 Stage 5- Opening of Branch............................................23
Chapter 3 Capital Requirements of a Branch...........................24
3.1 Introduction..................................................................... 24
3.2 Templates Used...............................................................25
a) Comparison Statement...................................................25
b) Capital Expenditure Proposal..........................................27
c) Purchase Order...............................................................30
Chapter 4 Financial Performance and Analysis........................33
4.1 Performance Highlights 2011-2012.................................33
a) Disbursements of Chola..................................................34
b) Asset Under Management (AUM) of Chola......................35
c) Networth of Chola...........................................................36
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d) Profit After Tax (PAT) of Chola.........................................37

4.2 Businesses of Chola........................................................38
4.3 Vehicle Finance Industry..................................................39
a) Disbursements of Chola VF.............................................39
b) Asset Under Management of Chola VF............................40
c) Income of Chola VF.........................................................41
d) Profit Before Tax of Chola VF...........................................41
4.4 Overview of Chola Vehicle Finance Position to Industry...42
4.5 Borrowings......................................................................44
Chapter 5 Integrated Marketing solution at Chola...................45
5.1 Introduction..................................................................... 45
5.2 Role of Integrated Marketing Solutions in Daily Life........48
5.3 Branding of Chola VF.......................................................49
a) Objectives......................................................................49
b) Target Audience..............................................................49
c) Influencing Factors..........................................................49
d) Medium of Communication.............................................50
e) Justification.....................................................................50
5.4 Steps for Awareness of Chola VF among Truck Drivers....51
5.5 Role of Corporate Social Responsibility to promote Chola
VF.........................................................................................52
Chapter 6 SWOT Analysis of Chola..........................................53
Chapter 7 Recommendations for Chola...................................55

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Chapter 1 Introduction
1.1 Brief Profile of the Head of the Company
Cholamandalam Investment and Finance Company Limited
(CIFCL) belong to the Murugappa Group.
Headquartered in Chennai, the Rs. 22314 crores (USD 4.4
billion as on March 31, 2012) Murugappa Group is one of India's
leading business conglomerates. Market leaders in diverse
areas of business including Engineering, Abrasives, Finance,
General Insurance, Cycles, Sugar, Farm Inputs, Fertilizers,
Plantations, Bio-products and Nutraceuticals, its 28 businesses
have manufacturing facilities spread across 13 states in India.
The organization fosters an environment of professionalism and
has a workforce of over 32,000 employees. The Group has
forged strong joint venture alliances with leading international
companies like Mitsui Sumitomo, Foskor, Cargill and Groupe
Chimique Tunisien has consolidated its status as one of the
fastest growing diversified business houses in India.
The group is a market leader in India across a spectrum of
products like fertilisers, abrasives, automotive chains, car door
frames and steel tubes. Neemazal, a neem-based organic
pesticide, is the market leader in bio-pesticides. Some of the
country's best-known brands like BSA and Hercules in bicycles,
Parrys Spirulina and Parrys Beta Carotene in nutraceuticals,
Ballmaster and Ajax in abrasives, Gromor and Paramfos in
fertilisers, and many more come from the Murugappa Group.
Its companies have tie-ups with Wendt gmbh of Germany,
Morgan Crucible Company plc of the UK, the China Engineering
and Exploration Bureau (CEEB), Cerdak Pty Ltd of South Africa,
Mitsui Tsumitomo Insurance Company Ltd of Japan, Borg Warner
Morsetec of USA, Foskor Ltd of South Africa, Groupe Chimique
Tunisien of Tunisia, and Cargill International SA of Geneva.
The group has grown consistently through its decisive and
visionary response to changing times. Its pioneering efforts,
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steadfast commitment to ethical business practices and its

dogged pursuit of new areas to extend its business acumen
have brought in its wake several prestigious national and
international awards. The Group's business philosophy can be
summed up in this couplet from the ancient Indian treatise on
wealth creation and governance, the Arthashastra:
"The fundamental principle of economic activity is that
no
man
you transact with will lose, then you shall not."
Conducting business by a clear set of values and beliefs, the
Group has observed very high standards of ethics and
transparency. Its belief in organisational renewal has allowed
the Group to adapt itself to changing economic contexts and
grow from strength to strength. The Management Development
Institute (IMD) of Lausanne, Switzerland, conferred the 'IMD
Distinguished Family Business Award' on the Group in 2001.
Commitment to the Community
The Group founders were aware of the importance and
necessity of corporate contribution to the welfare of the
community they were operating in, from the time they began
their journey in 1924. The AMM Trust was formed to set up and
run hospitals and schools in Chennai and Pallathur, the native
place of the founders.
The Murugappa Group continues to build on the culture of
philanthropy initiated by its founder. Social commitment has
always been the cornerstone of the group's ethos and it has
been at the forefront of eco-conservation, public health, and
education in the communities where its companies operate,
since 1957.
It runs four schools, a polytechnic college and four hospitals.
Besides, the group runs a research and development centre for
rural development, the Sri AM Murugappa Chettiar Research
Centre (MCRC), which has been designing simple, cost-effective
technologies for local artisans since 1977.
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The Group has scaled each pinnacle consistently through its

decisive and visionary response to changing times. Its
pioneering efforts, steadfast commitment to ethical business
practices and its dogged pursuit of new areas to extend its
business acumen have brought unprecedented success and
several prestigious national and international awards. But there
is no stopping for the Murugappa Group; the journey is still on,
in search of scaling newer heights and finding greener pastures
- beyond the horizon.

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1.2 Major Companies

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1.3 Brief Profile about CIFCL

History
Owing to Murugappa Group's pre-eminent position in the
industry and the consumer equity that it had painstakingly
built, the horizon offered opportunities in the financial sector. To
harness this, the group set up Cholamandalam Investment and
Finance Company Ltd (CIFCL) incorporated in 1978 with the
primary objective of offering asset finance through leasing and
hire purchase to corporate and then to retail customers. It has
since evolved itself into a large, composite financial services
organization. Today, Cholamandalam Investment and Finance
Company Ltd (CIFCL) offer stock broking, mutual fund and
investment advisory services through its subsidiaries.
Ever since its inception and all through its
has kept a clear sight of its values. The
values is a strict adherence to ethics and
those who come within its corporate
shareholders, employees and society.

growth, the company

basic tenet of these
a responsibility to all
ambit - customers,

Cholamandalam is a pan-Indian, composite financial services

provider. It comprises the parent company, Cholamandalam
Investment & Finance Company Limited (CIFCL), and its
subsidiaries Cholamandalam Distribution Services Limited and
Cholamandalam Securities Limited. The shares of CIFCL are
listed in the Bombay Stock Exchange Ltd. and The National
Stock Exchange of India Ltd.

Cholamandalam Investment and Finance Company

Limited (CIFCL)
Cholamandalam Investment and Finance Company Limited
was incorporated in the year 1978 as the financial services arm
of the Murugappa Group. The Company that commenced
business as an equipment financing company has now emerged
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as a comprehensive financial services solution provider that

offers vehicle finance, business finance, home equity loans,
stock broking and distribution of financial products to its
customers. The Company operates from over 350 branches
across India with assets under management over Rs.10000
Crores.
The
subsidiaries
of
Cholamandalam
include
Cholamandalam Securities Limited (CSec) and Cholamandalam
Distribution Limited (CDSL).

Cholamandalam Distribution Services Limited (CDSL)

Cholamandalam Distribution Services Limited is in the business
of providing wealth management services with enhanced focus
on larger product basket and unbiased investment advice.
Products offered include mutual funds, life and general
insurance, equities, fixed deposits, bonds, real estate advisory
and home loan. The company has a rich base of loyal clients
and ranks among the top distributors in the country with an
asset size of Rs.629 Crores. as on February 29, 2012.

Cholamandalam Securities Limited (CSec)

Cholamandalam Securities Limited is a securities broking
company offering stock broking and equity advisory services to
institutional investors, including many of the largest mutual
funds in India and individual clients across the country. It is a
member of Bombay Stock Exchange Limited and National Stock
Exchange of India Limited. It is also a depository participant
with National Securities Depository Limited (NSDL) and Central
Depository Services (India) Limited.

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1.4 Journey of Chola

The journey of Chola started in the year 1978 with Equipment

Financing and then with Vehicle Finance and then carried on
diversifying its business with Securities, Home Equity and so. In
the year 2012, they have managed to pool assets worth Rs.
140000 Million and an Equity Share Capital of Rs. 2120 Million.
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Chola has also been continuously paying dividend to its

shareholders since the year 1978, however in the year 2009 it
was not able to do so because of the recession and economic
slowdown, that had affected its business drastically.

1.5 Values and Beliefs

All the companies under the Murugappa Group follow a set of
values and beliefs. They believe that it is the values, principles
and beliefs that have always guided them and continue to show
the way forward.
The Five Lights
Companies are:

guiding

the

Murugappa

Group

and

its

INTEGRITY
We value professional and personal integrity above all
else. We achieve our goals by being honest and
straightforward with all our stakeholders. We earn trust
with every action, every minute of every day.
PASSION
We play to win. We have a healthy desire to stretch, to
achieve personal goals and accelerate business growth.
We strive constantly to improve and be energetic in
everything that we do.
QUALITY
We take ownership of our work. We unfailingly meet high
standards of quality in both what we do and the way we
do it. We take pride in excellence.
RESPECT

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We respect the dignity of every individual. We are open

and transparent with each other. We inspire and enable
people to achieve high standards and challenging goals.
We provide everyone equal opportunities to progress and
grow.
RESPONSIBILITY
We are responsible corporate citizens. We believe we can
help make a difference to our environment and change
lives for the better. We will do this in a manner that befits
our size and also reflects our humility.

1.6 Products of CIFCL

The products of Cholamandalam Investment and Finance
Company Limited are as follows:
Vehicle Finance
Chola Vehicle Finance The pioneers in Commercial
Vehicle Financing.
Chola provides finance for purchase of light and heavy
commercial vehicles. They help the needy to become
entrepreneurs by providing the necessary finance.
Features and Benefits of Vehicle Finance
o Loans from Rs.1 lakh onwards.
o Fast track approvals.
o Flexible finance schemes for new and used vehicles.
o Minimum documentation.
o Easy repayment options.

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 Home Equity Loans

Chola mortgages the property of the needy in return for
cash/ finance.
Features and Benefits of Home Equity Loans
o Loans from Rs.10 lakh upto Rs.5 crores depending on
your needs.
o Longer tenure loans for easier repayment.
o Borrow upto 60% of the value of your property.
o Fast track approvals.
o Special products for the self employed.

Corporate Mortgage Finance

Chola provides long term and short term mortgage
finance to the corporate/ businesses.
Features and Benefits of Corporate Mortgage Finance
o Purely Equity Shares
o Borrow up to 50/60% of value of the shares.
o Attractive interest rates.
o Simple and speedy processing.
o Ideal for HNIs with investments in listed shares and
Promoters of listed entities.
o Commercial/ Residential Property & Shares
o Borrow up to 50% on valuation of a combination of
Property and shares collateral with Principal loan
covered by Property.
o Property to be in nature of residential/commercial
space only.
o Simple and speedy processing.
o Ideal for HNIs and Promoters with investments in
listed shares and property.
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o Pure Commercial/ Residential Property &

Shares
o Loans from Rs. 200 Lacs onwards depending on
your needs.
o Borrow up to 50% value of property
o Attractive interest rates.
o Simple and speedy processing.
o Structured repayment / Bullet repayment
o Combination of Assets & Shares
o Borrow up to 50% value of shares and principal
covered by current assets & loans and
advances/Plant & machinery
o Attractive interest rates.
o Simple and speedy processing.
o Ideal for Corporates.
Gold Loans
Chola provides necessary finance to purchase gold to its
existing and prospective customers.
Features and Benefits of Gold Loan
o No advance interest.
o Easy repayment.
o EMI Option also available.
o Loans up to Rs. 1cr.
o Minimal documentation.

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Chapter 2 Stages for setting up a Branch

2.1 Stage 1- Identification of Branch and Documents
The first stage in the infrastructure process is the identification
of a branch. A team of members are sent to the respective
location and they identify the branch premises and convey the
same
to
the
infra
team.
The infra team asks for the required legal documents from
landlord of the said premises to further the process.
The list of documents to be collected from the landlord is as
follows:
If Free Hold Property
1. Document to show title (Any one of the following)
a. Sale Deed in his/her favour
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b.
c.
d.
e.
f.
g.

Partition Deed
Deed of Settlement
Will
Court order
Ownership Certificate issued by Govt./Authority
Such other valid documents

If Lease Hold/Mortgaged Property

1. Document to show title (Any one of the following)
a. Lease Deed
b. NOC from the original owner/Lessor or Govt.
Authority if the same is leased by the Govt./Bank/any
authority
And the following documents (All the below mentioned
documents)
2.
3.
4.
5.

Latest Property tax receipts and property book.

Latest Electricity Bill/ Receipt and Tariff Card
Building Plan Approval
Photographs of the premises (both inside and front
elevation of the building)
6. If the document no.2/4 (referred above) does not have
endorsement of commercial utilization, such other
documents evidencing/authenticating for commercial
utilization
7. PAN & Bank Pass book/ Voter ID/ Passport/ other identity
proof documents
Copies of the property documents has to be certified by the
BM/AM saying that the original documents been verified by him
(Sign with name, designation and employee code)
If the documents are in vernacular language
Obtain a legal opinion from a qualified legal consultant,
which opinion shall cover all aspects of ownership/
conformity with statutory norms including but not limited
to clarity on title of the premises as on date, category of
premises
(commercial,
residential,
industrial),
if
approved/unapproved construction, if all public dues are
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paid up to date etc with relevant supporting documents

perused by Advocate for rendering opinion/ receipts issued
by SRO etc annexed to the opinion.
The opinion with the endorsement of the respective Area Legal
Manager (ALM) to be sent to Head Office (HO).

2.2 Stage 2- Scrutinising and Forwarding of Documents

The infra team scrutinises the legal documents received and it
is signed by the Head of Infra department, stating that the
documents have been received and the seal of the company
i.e. Cholamandalam Investment and Finance Company Limited
(CIFCL) is affixed.
The documents are then forwarded to the Legal Department
who go through the legal documents word by word and if there
are any queries, the same are verified by the respective
location
branch
managers
or
the
landlord
himself.
After verifying and signing the documents, the legal
department forwards the same to the infra team who keep it as
part of their record. The final decision is however made after
receiving approval from the financial analysts who have a set of
conditions to be met by the location of the branch. On meeting
of such conditions, the financial analysts forward their report to
the Chief Financial Officer (CFO) who gives the authority to go
ahead with the proposal.

2.3 Stage 3- Role of Financial Analyst

The financial analysts go through the documents received and
the conditions they follow are:
1. In case of Chola Vehicle Finance
a. The branch location should be close to an industrial
or mining area, since Chola VF deals with light and
heavy commercial vehicles.
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b. The competitors in and around the concerned area.

c. In case of difference in the budgeted and proposed
rents, the approval has to be taken from higher
authorities after analysing the reasons.
d. The total population, profession and income of the
people residing in and around those areas.
e. The availability of utilities such as telephone,
electricity for setting up a branch.
2. In case of Gold Loan Finance
a. Blue Ocean Strategy which indicates a place of
operation where there is no competition and thus the
growth rate and profit can be high.
b. Presence of competition with higher productivity
c. Places common for loan business, ignoring places of
high risk such as lack of security.
d. Availability of utilities such as electricity, telephone,
water, transport etc
e. Availability of staff
f. Preference is given to ground floor or first floor.
Above that is totally ignored.
The above guidelines or conditions should be met in order to
get the approval for renting the proposed premises.
It is always better to rent a premise than buying the premise,
as the money involved is less and can be easily vacated if the
business
is
not
doing
well.
2.4 Stage 4 Security Deposit and Rent Allocation
The team of branch location members after deciding the branch
send the security deposit and the rent to be paid details along
with
the
legal
documents.
The legal team along with the financial analysts and the CFO go
through the proposed security deposit and the rent allotted and
then on researching the place of branch, find out the usual
amount of security deposit and rent for a certain square feet of
area
in
that
particular
location.
On completion of research, the financial analysts along with the
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CFO negotiate on the amount proposed on the security deposit

and the rent with the landlord and then mutually agree on the
amount to be paid.
The escalation is usually after a period of 11 months from the
start date. An agreement containing the start and end date is
prepared along with the address of the branch with the name of
the
lessor
and
lessee.
The rent is revised as the tenure expires according to the
escalation percentage. The escalation period and the escalation
percentage are mutually decided between Chola and the
landlord.

2.5 Stage 5- Opening of Branch

The proposed branch is given a green signal once the above
requirements are fulfilled. The infra team after collecting all the
necessary documents sends across the information to the team
of members in the proposed branch to pay the security deposit
to the landlord and occupy the property on a monthly rental
basis.
Thus the branch starts functioning either as Chola Vehicle
Finance, Chola Gold Loan, Chola Home Equity or Chola
Corporate
Mortgage
Finance.
Once the branch is setup, a branch manager is allotted along
with other manpower requirements such as sales collection
executives, field sales executives, credit managers and so on.

Chapter 3 Capital Requirements of a Branch

3.1 Introduction
The infrastructure team looks after all the capital requirements
of the newly setup and the existing branches. All the
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expenditure, either revenue or capital, are looked after and the

clearance process takes place after thorough assessment.
The budget is fixed by the financial analysts for the amount to
be spent on the purchase of various assets as per the basic
branch requirements and they make sure this amount is
sufficient. If the actual amount exceeds the budgeted, then the
same requires to be justified to the CFO and the Managing
Director (MD) and approval has to be taken for further process.
The first major expense relates to interiors. All the interior work
is managed by the team after receiving the required mail from
the branch as part of evidence.
The branch managers are required to approach the local
vendors and request quotations. On the basis of quotations,
and the requirement of a branch on the basis of a mail, the
infra team prepares the comparison statement by comparing
the quotes of different vendors received. If there is no query,
we directly speak either to the branch manager, who in return
clarifies with the vendor and gets back to us or we directly
speak to the vendor and clarify on the queries.
After preparing the comparison statement, we prepare a Capital
Expenditure Proposal (CAPEX) statement wherein the
requirements are mentioned clearly in a detailed manner. The
budgeted amount keeps getting deducted with increase in the
requirement of assets and also various taxes such as VAT,
Freight Charges and Service Tax are included in the price of the
assets.
The next stage is the clearance stage wherein the Infra Head,
Business Head, National Business Manager, CFO and the
Managing Director give their approval to the proposed assets.
After obtaining the clearance, the Purchase Order is prepared
and presented to the vendor and along with this the payment is
released according to the payment terms.

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3.2 Templates Used

a) Comparison Statement
This is a comparison statement consisting of quotes from
various vendors for Fire Extinguishers requirement in branches.
All the quotes are thoroughly checked and then the following
statement is prepared.
Comparison Statement

Date: 18th May, 2012

Prepared by

Reviewed by

Subject: Purchase of Fire Extinguisher for our New Phase 3

Branches (116 Numbers).
Fire Extinguisher 2 Kg ABC Powder 116 + 19
Branches
Vendor

Brand Name

MM Fire
Safety
Equipments

Seven
Hills Fire
and
Safety

Canex
Industry

Safety First

Vintex

Vintex

142

Basic Price for

1 no
Spl discount
Vat @ 14.5%
Vat @ 12.5%
Total Cost for
1 No
Total cost for 2
Nos

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Min Rs. 200/- in

Tamilnadu
other states at
actuals as
extra

Cost of Rs
Rs. 200/for
southern
states Rs.
300/other
states
extra

Rs. 346/-

Immediate

within 15
days

within 10 days

Through Local
Transport

Through
Courier

Through
Registered
Parcel

Against
Delivery

After
delivery

Against invoice
after dispatch of
Materials

5 years

2 years

5 years

Supply Area

TN, KAR, MAH

Pan India

Pan India

Weight in Kg

14609

14609

14609

30

30

30

Shipment Cost
per Branch
Delivery
Period

Delivery

Payment
Warranty

IS MAP
Mono
Ammonium
Phosphate

Recommendation:

We can go with M/s Canex as their price is less than the other
two vendors for the same specifications.
Also M/s Canex will deliver the Fire Extinguishers through
Registered Parcel. Thus the delivery will be fast and also safety
will be ensured.

_____________
__________________
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Manager
(AVP &Head Infra)

NOTE: The prices have been

confidential to the organization.

removed

since

they

are

b) Capital Expenditure Proposal

The next step after preparing the comparison statement is to
prepare a capital expenditure proposal (CAPEX).
The CEP No. denotes the number of capital expenditure
proposals made and sent for further process.
There are different types of work involved depending on the
branch requirement such as furniture purchase, equipment
purchase, combination of both, major or minor interior work to
be carried out at branch, any replacement of furniture or
equipment
and
so
on.
The budget reference head denotes various heads of Chola and
there are different budget expenditures allocated under
different heads. The various heads include Chola VF Relocation,
Chola VF New Branches, Chola VF Other Equipments and
similar divisions for Chola Gold Loan and Chola Home Equity.
The budgeted amount is fixed by the financial analysts in
advance for the entire financial year. The previous amount
spent on branches is brought forward and the cumulative
amount is deducted from the budgeted amount as shown in the
example below.
In being part of the financial analyst team, it was
observed that the individual budget for a branch depends upon
the square feet or the area of a branch. Thus the basic
requirements are kept in mind and unnecessary expenses are
avoided.
The statement is divided into 11 sub divisions, in which all the
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transactions are carried out. These include all the possible

expenditures or assets that are required in a branch.
This proposal is prepared by us in the infra team and then
needs to checked by the finance team if it is within our
benchmark prices and then by the Business Head (BH), the
Chief Financial Officer (CFO) and then finally by the Managing
Director (MD).
A template of the CAPEX Statement is below:
NOTE: The prices have been removed as they are confidential
to the organization.

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(i) Contingency
A contingency of 5% is maintained by the organization while
preparing the CAPEX statement due to the difference in days
for getting the quotation and executing the same as per the
requirement
of
a
branch.
There is a possibility that the prices may go up and thus to be
on a safer side, the 5 % contingency plays a cover up role to
overcome such circumstances.

c) Purchase Order
A Purchase Order (PO) is prepared once the sanction is received
from the MD for the amount to be spent as per the branch
requirement on the Assets or the Branch requirement. The
purchase order needs to be sent to the vendor from whom the
assets are to be purchased. The vendor dispatches the goods to
the consignee after the payment terms are sought.
The following is a purchase order issued by the organization:
NOTE: The prices have been
confidential to the organization.

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removed

since

they

are

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OTHER TERMS & CONDITIONS

1.

This Purchase / Works shall be valid for the period mentioned in the order, unless amended in writing or extended through
written communication.

2.

The goods as per the Purchase / Works shall be new, standard, off-the-shelf items of merchantable quality unless they are
made-to-order as per specifications laid down in the Purchase / Works and any amendments thereof in writing. It shall be
the responsibility of the Supplier to ensure that the purchase has been properly authorised on behalf of the Purchaser.

3.

The Price Stated on the face of the Purchase / Works Order is inclusive of all taxes and duties, present and future as
applicable to the transaction unless mentioned otherwise.

4.

The Price stated on the Purchase / Works Order is inclusive of cost of goods ordered, insurance, packing, and forwarding
and freight, unless specifically stated otherwise. Transit insurance, as applicable shall be the sole responsibility of the
Supplier.

5.

It shall be a term of this purchase that the goods ordered shall be delivered at the site address provided in the order
unless otherwise stated.

6.

The goods shall be supplied as per the delivery schedule stated on the Order. In case of non-delivery of the goods, for
whatever reason, the Purchaser shall be at liberty to recover penalty of such amount as may be suffered due to the nonsupply or delay in supply of the goods within the delivery schedule.

7.

The Purchaser reserves the right to cancel the Purchase / Works in case the Supplier does not meet the stated delivery
schedule or for any other reason the Purchaser deems proper.

8.

Installation and Commissioning of the goods shall be done as per the instructions of the Purchaser and any delay or loss
arising there from shall be the sole responsibility of the Supplier.

9.

Payment in terms of the Purchase / Works Order shall be made only after satisfactory installation and commissioning of
the goods and where necessary, testing / verification / approval of the goods by the Purchasers engineers / consultants /
authorized representatives.

10. All payments shall be made only by way of cheques favouring the supplier or his authorized banker, as the case may be.
In the normal course, cheques are processed for payment only within twenty-one days of receipt of all relevant documents
after satisfactory installation / commissioning, as the case may be.
11. WARRANTY: The Supplier shall warrant satisfactory performance of the goods in strict compliance with the specifications
given by the Purchaser for a period specified in the Purchase / Works Order. All defects arising out of faulty design,
manufacturing, workmanship, process, inferior material etc. shall be the sole responsibility of the Supplier. The Purchaser
shall have the unconditional right to reject the goods and cancel the Purchase / Works in the event of supply of goods of
quality, which is not acceptable to the Purchaser. The Purchaser shall also have the right to demand rectification / repair of
the goods, wherever he deems fit, at his own option, from the Supplier, at no extra cost, expense or time for ensuring that
the goods satisfy the desired need of the Purchaser. The Purchaser reserves the right to demand indemnity, liquidated
damages etc. of such amount as may be deemed appropriate by the Purchaser in case of any failure, non-performance,
non-commissioning etc. in relation to the goods.
12. Time is of essence to this Purchase / Works and all time lines stated in the Purchase / Works are to be strictly complied
with.
13. The Purchaser has a right to demand Pre-Delivery Inspection either at the premises of the Supplier or at the premises of
his sub-contractor, as the case may be and this shall be a strict condition prior to acceptance of the goods ordered.
14. Neither the Purchaser nor the Supplier shall be liable to meet the obligations under this Purchase / Works due to Force
Majeure.
15. The Supplier shall maintain strict confidentiality of the terms of this Purchase / Works as well as any details of the
Purchaser that he may come to know in the course of transaction.
16. Any non-standard term or condition shall not be applicable to this Purchase / Works unless specifically agreed to in writing
in this Purchase / Works.
17. In case of any dispute or differences, the matter shall be referred to arbitration under the Arbitration and Conciliation Act,
1996.
18. The jurisdiction for the purpose of this Purchase / Works shall be at CHENNAI.

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Chapter 4 Financial Performance and Analysis

4.1 Performance Highlights 2011-2012

The following analysis has been performed:

From the above figure, it can be depicted that the
disbursements have gone by 55% between the two financial
years 2011 and 2012. Disbursements are the loans provided by
the company. The increase is due to the business done by
chola and also the profits are determined by the difference in
the rates of the industry and the rate of interest charged by
chola.
The Profit after tax (PAT) has gone up by 177% during the last
financial year. This is due to the reduction in the provision and
loan
losses
being
incurred
in
a
year.
The Return on Total Assets (ROTA) has seen an increase in 86%.
ROTA is calculated by adding Interest and Taxes to Earnings
before interest and taxes (EBIT) and dividing the same by the
Total Assets. The total profit earned during a financial year has
a
direct
impact
on
the
ROTA.
The book value of assets of chola has gone up by 20%. This is
due to the expansion of branches being initiated by chola. Thus
as the number of branches increase the number of assets also
increase.
The Earnings per share (EPS) is directly proportional to the
profit earned in a financial year. There has been an increase of
154% in the last year and it is calculated by dividing the profit
after
tax
by
the
number
of
shares.
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The Return on Equity (ROE) is also dependent on the total profit

earned in a year. Thus the shareholders have had an increase
of
106%
in
their
share
value.
a) Disbursements of Chola

90000
15281

80000
70000
60000
50000

3180
541

40000

21260

30000

12346
Home Equity

5010

44961

8410

20000

Gold Loan
Personal Loan
Vehicle Finance

28613

25250
10000

73064

10044

15020

NOTE: The figures are in million rupees.

The above chart depicts the disbursements of the products of

Chola over a period of 5 years.
Vehicle Finance has been the most successful business of Chola
with a strong growth in recent years with a growth of 62.5%
growth in the last financial year. Chola VF is second in the
industry to Shriram Motor Finance.
Personal Loans have been ceased as the business was not
doing well and the growth rate was slow.
Home Equity has maintained a steady growth over a period of
time and is second successful to vehicle finance with a growth
rate of 23.8% in the last financial year.
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Gold Loan business has been commenced recently and has

already disbursed amount of Rs. 541 million in the last financial
year. It faces stiff competition from Muthoot Finance and
Manappuram Gold Loan.
b) Asset Under Management (AUM) of Chola

300000

250000

134620

200000

Total

150000

100000

50000

91242
70710
60328
17128
53582

16760
43568

Assigned
12208

On Book

68505
7630
122412

16908
83612
51597

0
2007-2008 2008-2009 2009-2010 2010-2011 2011-2012

NOTE: The figures are in million rupees.

The following analysis has been performed:

Asset Under Management (AUM) is a financial term denoting
the market value of all the funds being managed by Chola or
any other financial institution (a mutual fund, hedge fund, or
brokerage house) on behalf of its clients, investors, depositors,
etc.
The On Book amount denotes the brought forward amounts of
the previous year whereas the Assigned amount refers to the
Disbursements net of Run downs. Run Downs refer to the
repayment
of
loans
by
the
customers.
There has been a consistent growth in the Asset Under
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Management (AUM) of Chola since the year 2008-2009. There is

an increase of 33% in the year 2010-2011 and an increase of
48% in the year 2011-2012 in the business of Chola AUM.

c) Networth of Chola

Networth
16000
14000
12000
10000

Networth

8000

14327

6000

10720

4000
2000

7810

7850

5586

0
2007-2008 2008-2009 2009-2010 2010-2011 2011-2012

NOTE: The figures are in million rupees

Net worth is the total assets minus total outside liabilities of an

individual or a company. It is also called the net assets of the
company.
There has been a consistent growth in the networth of Chola
over a period of time. Its primarily due to the business doing
well.
The growth in the last financial year has been 34%.

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d) Profit After Tax (PAT) of Chola

PAT
2000
1800
1600
1400
1200

PAT

1000
1725

800
600
400
200

594

622

427
154

0
2007-2008

2008-2009

2009-2010

2010-2011

2011-2012

NOTE: The figures are in million rupees

The Profit After Tax of Chola has increased drastically in the last
financial year due to the decrease in the provision and loan
losses. This has been possible due to the revised guidelines in
the Securitization transactions during September 2011.
The major slump was during the year 2009- 2010 due to the
recession and the falling stock markets. However there was a
drastic growth in the year 2010-2011 with an increase of 304%
when the economy started doing well and recovering. In the
last financial year there was a growth of 177%.
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4.2 Businesses of Chola

The above depicts the various products of Chola through which

it does its business. The total managed assets are worth
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Rs.134620 Million of which the total owned assets are worth

Rs.122412
Million.
Vehicle Finance is the dominating among all with total assets of
Rs 98935 Million with a share of 73.1% out of which Rs.88541
Million is owned by Chola at 72.3%. It is followed by Home
Equity, Business or Corporate Mortgage Finance, Gold Loans
and Personal Loans.

4.3 Vehicle Finance Industry

a) Disbursements of Chola VF

Disbursements (in Rs)

80000
70000
60000
50000
40000
30000
20000
10000
0

73064
44961
28610

25250

Disbursements (in Rs)

15020

NOTE: The figures are in million rupees

Disbursements refer to the loans provided by chola for

Commercial Vehicles. It includes loans for Light, Medium and
Heavy Commercial Vehicles. Different rate of interest are
charged for the above categories and also for the number of
vehicles required.
The vehicle finance business has been doing well other than in
the year 2008-2009 when there was recession and an economic
slump. In the last financial year there was a growth of 63%.

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b) Asset Under Management of Chola VF

250000

200000

150000

98395
Total
Assigned
On Book

100000
60115

50000

33310

39130

2683

30600
7753

13218

10226

20092

20374

9854

88541
57432

31377

0
2007-2008 2008-2009 2009-2010 2010-2011 2011-2012

NOTE: The figures are in million rupees

Asset Under Management (AUM) is a financial term denoting

the market value of all the funds being managed by Chola or
any other financial institution (a mutual fund, hedge fund, or
brokerage house) on behalf of its clients, investors, depositors,
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etc.
The On Book amount denotes the brought forward amounts of
the previous year whereas the Assigned amount refers to the
Disbursements net of Run downs. Run Downs refer to the
repayment
of
loans
by
the
customers.
There has been a consistent growth in the Asset Under
Management (AUM) of Chola since the year 2008-2009. There is
an increase of 54% in the year 2010-2011 and an increase of
64% in the year 2011-2012 in the business of Chola AUM.
c) Income of Chola VF

Income
16000
14000
12000
10000
8000
6000
4000
2000
0

13340
8815
4230

5240

5800
Income

There has been a growth rate of 51% in the last financial year
due to the increase in business of Chola.
d) Profit Before Tax of Chola VF

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Profit Before Tax

3000
2390

2500
1873

2000
1500
1000

Profit Before Tax

690

500

740
380

NOTE: The figures are in million rupees

The Profit Before Tax (PBT) has had a growth of 28% in the last
financial year as compared to 153% in the year before that.
4.4 Overview of Chola Vehicle Finance Position to
Industry

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The above pyramid compares the position of Chola Vehicle

Finance to that of rest of the industry.
It can be depicted that Chola is focused on first time users and
small ticket operators, older vehicles High Commercial Vehicles,
Light Commercial Vehicles, Medium Usage Vehicles, Cars and
Small
Commercial
Vehicles.
Cholas disbursement for about 65% is in the Small Road
Transport Operators (SRTOs) and also the First Time Users
and Small Ticket Operators which include Heavy and Light
Commercial Vehicles (HCV & LCV). In this category, the risk is
high since there may not be sufficient papers as the amount
involved is low and also this category includes people owning
less than 10 vehicles. Thus there is a possibility of negligence in
the legal aspects and results in increase of defaults in payment.
The likely loss incurred via defaults is close to 2%. Since the
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risk involved is high, the rate of interest is high. The interest is

anywhere between 20-26%.
The next category involves Medium Transport Operators who
own 10 to 25 vehicles. These vehicles include Heavy and Light
Commercial Vehicles (HCV and LCV). Cholas disbursement
involves 25% in the Medium Transport Operators category.
In this category, the risk involved is less when compared to
Small Road Transport Operators (SRTOs). The default payment
is close to 1.5%. The rate of interest is between 12.5% and
20%. Since the vehicles and the disbursements involved are
more, and to be more competitive in the market, the rate of
interest is low and also the default rate is low.
The final category is the Large Transport Operators who own
26-50 vehicles. Cholas disbursement involves 10% in the
Large Transport Operators category. The risk involved in this
category is very low since the customers are in the business for
a long time and defaults are rare, the percentage is close to
1%.
The customers in this category look for huge
disbursements from companies and thus negotiate on the rate
of interest. Chola offers disbursement at 11.5% to 12.5% rate of
interest. This rate is derived after studying the competitor
rates.
Cholas Vehicle Finance business involves disbursement only to
the above three categories. It does not involve Principal
Operators having more than 50 vehicles. This category is the
next target of Chola and they are looking to peep into very
soon in the near future.

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4.5 Borrowings

NOTE: The figures are in million rupees

The above graph shows the borrowings of Chola. The

borrowings can be in any form such as Subordinate Debt and
PDI, Debentures, Commercial Papers or the most popular Bank
Loans. The borrowings have increased year after year due to
the increase in disbursements of Chola. The business being
done by Chola is increasing drastically and thus it has an
impact
on
the
borrowings
figure.
Chola has been decreasing the issue of commercial papers
since they are not in much use these days and are
concentrating more on Subordinate Debt and PDI, Debentures
and Bank Loans.

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The above table shows the individual breakup of the

borrowings and there has been an increase of 47% and 44% in
the last two financial years respectively.

Chapter 5 Integrated Marketing solution at Chola

5.1 Introduction
Integrated Marketing Communications takes into account (at
least as much as possible) every single possible imaginable
way we and our customers (and prospects) interact with each
other. This includes traditional and non-traditional media, both
online and offline.
Traditional media usually refers to mass media- the use
of TV, radio and newspapers. As businesses find new and
innovative ways to promote their products and services,
we now have a wide array of non-traditional media to
connect with customer market: local store events, viral
videos, the use of social media like Facebook, MySpace
and Multiply, and even parties and concerts.
Online marketing channels are huge these days: with
search engine optimization (SEO), blogs, podcasts, social
media of all kinds, online TV shows and workshops and we
also have online affiliate programs, pay-per-click ad
schemes, and e-mail blasts. Aside from traditional mass
media, offline marketing channels also consider direct
mail campaigns, public relations, the use of billboards and
industry analyst relations.

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There are a whole lot of marketing tools to play around with,

and it can be easy to get lost in figuring out the best ones to
use for any given promotional campaign.
Lets review: the goal of Integrated Marketing Communications,
or IMC, is to bring together all the elements of your corporation
(advertising, sales, customer service, public relations, direct
marketing, sales support, etc.) into a singular, unified force
rather than having these different departments all work
independently and separately from each other.
The end result is that we have a single concept; a single
brand message across all marketing channels, customized
for any advertising or promotional effort, bearing in mind time,
budget and the goals of the current campaign.
Most of the organizations now embrace the management
concept of Integrated Marketing Communication. While the
concept of IMC had already been introduced several years ago,
its importance to Small and Medium Enterprises (SMEs) has
grown- particularly with todays more challenging business
environment.
5 Reasons Why IMC Is More Important These Days:
1. More Contact Points. It used to be that traditional mass
media (radio, print, TV) was the way to go when it comes to
advertising a product, service or brand. While they still have
their uses, customers now interact with brands in so many
ways beyond this.
A customer may have heard about a restaurant from another
friend when they had a great dining experience there the last
time. He goes online to check out the menu, and calls up the
restaurant to make reservations. When he and his date comes
in, they cant help but notice how cosy the place is, and get the
chefs recommended dishes for the night.
It is the aim of any Integrated Marketing Communications
practitioner to cover ALL these contact points: including
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customer service, store design, direct marketing, word-ofmouth marketing, the internet, after-sales service, new media
etc.
2. More specialized media. It used to be that mass media
was enough to cover any advertisers needs. But with everincreasing ad clutter, shorter attention spans and greater
resistance to advertising, customers now tend to be a lot more
selective: they shut out the stuff they feel they dont need, and
go with the stuff that they want.
So media now tends to zero in on a particular niche market: you
now have a cable channel just for kids- 24/7; totally unheard of
few years back. There are magazines that cater to
entrepreneurs, pet owners, budget travellers, mothers and
sports fans.
Recently, weve seen even more specialized media: there are
podcasts now that talk about starting up a successful small
business, viral video clips of cats, and blogs on cheap hotels
and resorts in the Asia-Pacific.
3. More than ever, customers are king. The power has
shifted from the manufacturers (those who make a product) to
the retailers (those who actually sell the product). It is known:
its easier to keep an existing customer happy than it is to win
back a customer you lost. Retailers now place greater
emphasis on protecting their clientele- and take great pains in
whipping up the best possible experience for their patronsbefore, during and after the sale.
4. Marketing in now more data-based. When a client blows
US$10 million on a local TV ad campaign, does it know exactly
how many people watched his ad? Out of those who did see
the ad, how many of them actually remembered it was all
about? And of those who did manage to remember what it was
about, how many answered the call to action?
More advertisers are reluctant to shell out wads of cash for
media buy- and rightly so. How do you know youre getting
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your media investment back? Understandably, they want to

see figures- to see exactly how that quarterly ad campaign
budget is spent, and ask themselves: is it really worth all the
time, money and effort?
Particularly among small- to medium-scale enterprises, we now
have all kinds of marketing tools for any given promotional
campaign. As business becomes more cutthroat, business
owners who are also now more involved in the marketing
process hang on tightly to their media budgets- and let go after
carefully choosing the right mix of media- both traditional and
non-traditional.
5. More widespread internet use. Thanks to the worldwide
web, customers can now check out what they want anytime
they feel like. Conversely, it also means that business can also
exist outside the regular business hours, and therefore have the
opportunity to keep selling 24/7.
Every company should have an online presence now- and it
doesnt have to be a static brochure-type website. Company
blogs give a more human face to business, allowing interaction
with online audience. Innovative promotional activities can
help bring in new business. And it can be expected that clients
could talk about products- particularly so if product, service or
brand has made a tremendous impact on them- both in good
and bad ways.

5.2 Role of Integrated Marketing Solutions in Daily Life

The role and importance of Integrated Marketing Solutions can
be explained with an example that a consumer goes through
his daily life:

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A common man in the age group of 18-30 years usually starts

his day by working out at the gym He often listens to music
while working out or watches television. Thus branding can be
done through either radio or television channels. After working
out, he/ she get ready for office or college and they hardly get
time to flip through the newspaper entirely. Thus there is every
chance of an advertisement being missed out.
The next stage the consumer travels to office or college and
would like to listen to Radio FM irrespective of the mode of
transport. Thus companies should use this as a platform to
showcase their products and bring about awareness. Another
means of communication is through word of mouth. This is
possible only when consumers get aware of the products. Thus,
different means of communication should be used to reach the
consumers.
Another important means of communication used by a
consumer in his daily life is through e mail which is a one way
communication. Thus the message should be passed on very
clearly and the consumer should sync with the thought behind
the marketing strategy applied. There are also social
networking sites such as Facebook, Twitter that can be used to
create awareness among the products.
The consumers use their mobile phones round the clock and
thus an SMS can be a good option to advertise. There is equal
importance of billboards near traffic signals that catch the eye
of the consumer while travelling. The billboards should be
presented with attractive colours to attract the attention of the
consumers.
Thus it is clear from the above that just advertising in
newspapers or television is not sufficient for visibility of the
brand. Other means of communication should be used to
attract the consumers.

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5.3 Branding of Chola VF

a) Objectives
To identify the customers who utilize commercial vehicles
for their business.
To study the market and identify various competitors to
which these customers are attracted for vehicle finance.
To make the customers aware of Chola Vehicle Finance
through
effective
branding.
b) Target Audience
Customers who are in the business of commercial
vehicles.
Budding entrepreneurs in the field of commercial vehicles.
Attracting customers who tend to diversify their business.
c) Influencing Factors
Visibility through geographical diversification.
Attractive credit schemes.
Lower interest rates.
Flexibility in legal formalities.

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d) Medium of Communication
Attractive billboards and posters on various food and tea
stalls on highways to attract the vision of truck drivers.
Distribution of mini pamphlets/cards at toll gates.
Visit of volunteers to the customers office and engage
directly to make them aware.
Advertisement in local newspapers to attract owners of the
commercial vehicles.

e) Justification
Volunteers should be appointed by Chola in both urban and
rural areas to interact with the customers in the field of
commercial vehicles.
The customers should be made aware of the existence and
schemes of Chola VF.
The volunteers visiting should have a list of existing and
satisfied customers and the same should be shared to the
prospective customers.
The owners of the commercial vehicles would definitely be
looking for advertisements in newspapers for VF and
expansion of business, thus an ad in the newspaper could
be effective.
By distributing mini pamphlets/cards of Chola VF at the toll
gate, there is every possibility for the truck driver to glance
through it and communicate the same to its owners.

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5.4 Steps for Awareness of Chola VF among Truck

Drivers
Billboards and Posters in the truck stand and in nearby tea
stalls.
Distribution of soaps/match boxes having the outer cover
of Chola VF (like in hotels).
Attractive advertisement in local newspaper/issue of
pamphlets with the face of a celebrity or a model.
Distribution of cups to tea stall vendors with a tag line in
local language like your needs are our priority or so.
Volunteers in and around those areas to start an informal
conversation with the truck drivers and praise Chola VF by
word of mouth.
Distribution of caps/umbrellas/handkerchiefs due to the
change in temperatures.
Setting up stalls in the truck stand and educating the
drivers about few social issues along with information
about Chola VF.
Distribution of pens/pencils with Chola VF tag.
Distribution of torch lights as its immensely beneficial
during breakdowns.
Use of stickers on trucks with tag lines such as Drive
Safe or Horn Ok Please sponsored by Chola VF.
Distribution of hand-made fans with Chola written on it.

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5.5 Role of Corporate Social Responsibility to promote

Chola VF
Educate the truck drivers about global warming being
caused by deforestation.
Give them tips about the importance of trees and
representing Chola, plant trees in front of them and
promote Chola VF.
With the rise in fuel prices, set up billboards or a campaign
with the tag Save Fuel Save Money.
Provide Statistical data to the truck drivers about the
means adopted by financiers to recover money and show
how Chola is different.
Provide Statistical data about the number of accidents
caused by drunk or rash driving and the importance of
safe driving.
Organize a few games in or around the truck stand and
invite the drivers to participate.
Distribute small gifts sponsored by Chola to the winners;
this will build awareness among them about Chola.
Conduct stage shows or role plays and pass on the
message about the benefits being associated with Chola.
Conduct a survey about the most frequent problems faced
by truck drivers and campaign on such issues to get the
confidence of them.
Educate the importance of following traffic signals and the
harm that can be caused ignoring the same.

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Provide tips on how to face the heat during summers and

as part of promotions provide free water bottles.

Chapter 6 SWOT Analysis of Chola

Strengths:
Wide Product Range.
PAN India presence.
Strong client base at North and West Zones.
Well defined business model.
Entire process is in housed with experienced man power.
Strong management in the core business and execution.
Part of Murugappa Group worth having Networth of 14327
million.
Chola VF having its own web portal for buying and selling
used commercial vehicles, www.shubhtrucks.com. This is
unique.

Weakness:
With the size and performance of the group, the focus on
PR quotient is low.
Despite being strong in south, the awareness in north
region is less.
Under utilization of the brand name that Murugappa Group
has in terms of capturing the market.

Opportunities:

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 Opening of Phase 3 branches in remote areas where there

is not much competition can increase the business of
Chola.
High Networth Individual (HNI) population is growing
rapidly at a faster pace, so huge market potential.
Power of equity unmatched, has outperformed all other
Asset classes.
Chola stands 2nd in the Commercial Vehicle Finance to
Shriram Motor Finance and 3rd in the Gold Loan sector to
Muthoot Finance and Manappuram Gold Loans. Thus there
is a huge market for both these products.
Threats:
Increasing competition from competitors like Shriram
Finance, Tata Motor Finance, Muthoot Finance etc.
Regulatory changes by statutory bodies like RBI, SEBI,
IRDA, etc have led to erosion of margins.
Unorganized/Local market players playing a spoilsport.

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Chapter 7 Recommendations for Chola

Chola should look to open a bank since its got products
that a typical bank offers in the form of Vehicle Finance,
Home Equity, Gold loans, etc. They are also very well
known in the market of Vehicle Finance and Gold Loan.
Thus this opportunity should be capitalized for expansion.
The total working costs should be reduced in terms of
costs incurred for every transaction to be processed and
the time involved.
The delegation of authority should be given to each
department to a certain amount to make decisions than
everything being made by the top management.
The income includes waivers in various forms, this should
be reduced. The remaining amount should be used for
further development of the organization.

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