The company was incorporated in 1988 by Mayank Poddar and Sanjay Chamria as Magma Leasing Limited and commenced operations in 1989.

[4] In 1996, the company entered the retail financing business for vehicles and construction equipment.

In 2007, Shrachi Infrastructure Finance merged with the company, increasing its footprint and status in southern and western India.

In 2011, global PE firm Kohlberg Kravis Roberts and International Finance Corporation, an arm of the World Bank Group, invested about $100 million in the company.

In March 2021, Magma HDI announced a capital infusion by ICICI Ventures, Cyza Chem, and Morgan Stanley.