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Sowmya Sundar

THE fixed deposit programme of Ashok Leyland Finance is one of the better fixed-income options available in the market. Not only are the interest rates attractive, they are also higher than the general market rates at any point of time.

Even during the declining interest rate regime, ALF paid at least 50 basis points higher than the market rate on a risk-adjusted basis.

The rates are comparable with that offered by small savings schemes such as Kisan Vikas Patra.

A low minimum deposit amount for the cumulative scheme makes it even more attractive.

The interest rates under the cumulative scheme are 7.5 per cent for one year, 8 per cent for two years and 8.50 per cent for three years. The minimum deposit amount is Rs 1,000.

One can choose between monthly, quarterly and annual interest payment under the non-cumulative scheme. The monthly option is available only for a three-year tenure and the minimum deposit amount is Rs 15,000.

The quarterly payment scheme is available for two and three years and the minimum deposit amount is Rs 10,000.

Investors can invest across all the three tenures. Details can be had from the Chennai office at Sudarsan Building, 86, Chamiers Road, Chennai - 600 018.

Ashok Leyland lends for the purchase of commercial vehicles and two-wheelers.

The company has a market share of 10 per cent in commercial vehicles financing and 4 per cent in two-wheeler financing.

A strong foothold in the market, ability to raise funds at competitive rates and the steady growth in disbursements and profitability minimises the business risk.

With the automobile market taking off, the company can expect steady growth in profits and cash flows.

From a financial risk point of view, ALF is constantly improving in terms of capital adequacy ratio. Non-performing assets, as at end-March 2003, was comfortable at 0.9 per cent of total assets NPA.

ALF's deposit scheme is one of the safer and paying options, considering its good track record and the reputation for promptly honouring depositors' commitments.

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