Muthoot Capital Services (MCSL), the vehicle finance arm of Muthoot Pappachan Group, has clocked a 54% surge in its annual net profit for 2018-2019. This is despite the Q4 profit of the same year shrinking 15% from the Q4 profit of the previous year. MCSL\u2019s net profit for Q4 of 2018-19 is barely Rs 18.4 crore. In the corresponding quarter of the previous year, this was Rs 21.5 crore. However, the annual profit has zoomed to Rs 82.4 crore from Rs 53.7 crore in 2017-2018. MCSL disbursed Rs 2,135.1 crore in 2018-19, 8% higher than that the Rs 1,969.6-crore disbursement in the previous year. \u201cIt was on the steam of the spread-out in geographical risks that we were able to survive several odds. We have firmed presence in 20 states,\u201d MCSL CFO Vinod Panicker told FE. \u201cAt first it was the spate of natural calamities ranging from floods in Kerala and cyclone in Andhra Pradesh\/Tamil Nadu. Like all motor finance companies we were hit by the Supreme Court order on the issue of third-party insurance for a five-year period. The recent liquidity crunch in the NBFC sector and de-growth in vehicle sales were dampeners,\u201d he said. A strategy that paid off was the geographical de-risking move, initiated three years back. MCSL had jacked up its non-South disbursements from 6.2% to 30%, so that if natural calamities struck in the South, the growing disbursements in the North would offset them. However, in Q3, the net profit dropped mainly because of securitisation transactions to the tune of Rs 366.23 crore. MCSL had securitisation deals with banks like HDFC, Kotak Mahindra, ICICI and DCB for about Rs 837 crore this year. With a normal monsoon forecast for the current year, MCSL expects the two-wheeler demand to recover. \u201cBetter crop would mean better automotive demand in Tier-2 and Tier-3 cities, where we are active,\u201d says Panicker. The company plans to launch the used-car loan scheme that it had tested in the South last year, in Maharashtra, Delhi and Punjab in Q3 of the current fiscal.