Shriram Finance is one of the oldest and most prominent NBFC (non-banking finance companies in India. It is active in the domains of commercial vehicle finance (including pre-owned vehicles), two-wheeler loans, passenger vehicle loans, loans to small and medium enterprises, personal loans, issuing fixed deposits (FDs), giving loans for construction equipment and farm equipment loans as well as working capital loans.
“We are the leading lenders for all mobility activities. We fund all types of commercial vehicles, passenger vehicles, two wheelers, construction equipment and even tractors. Everything that moves is being financed by us. We also lend to small ticket lenders — those who want to asset up their business. We are the largest two-wheeler financiers now,” Umesh Revankar, executive vice-chairman, Shriram Finance has said.
Foray into green vehicle financing
Shriram Finance’s next stop is going to be financing green vehicles or electric vehicles. And not financing the vehicle itself, but the entire ecosystem that constitutes both the vehicles and the charging stations. “We want to participate in green vehicle financing from the beginning. Not only is it new in India and to its people but also it gives a sustainable resource for the entire community. So we are also looking at charging stations and solar panels,” Revankar said. Explaining why the company wants to be present in the entire chain, Revankar asseertd, “The government is giving a lot of subsidy and support to those who want to convert to green solutions. We want to be there and we want to be there form the beginning. We want to finance from vehicles to charging stations, since just be financing the vehicles you won’t learn. By financing the ecosystem we are also supporting the ecosystem.”
Growth is the way forward
The Shriram Finance boss can feel a lot of energy in the market and says that the company can easily sustain the fast pace of growth it has achieved. “We can easily grow at a rate of 15% year-on-year. That’s the initial guidance we have given. For the past one and a half years we are growing at around 20%. There is a lot of credit demand. The merger of Shriram Transport Finance and Shriram City Union Finance has given us more capability. We are cross selling the products, making products available, using data analytics better, understanding the customer, customising the product better. These have culminated into higher growth, higher margin and lower,” he remarked.
Expectations from the Budget and interest rate cuts
“The government expenditure has come down significantly. India’s growth is mostly dependent on government spending. Private capex is not moving as expected. Even the consumption is looking a little weak. There are not enough jobs created. Infrastructure spends create lot of unskilled and semi-skilled jobs. I think in this budget the entire focus will be on infrastructure and supporting private capex to happen so that more jobs get created.”
Revankar also feels that even if the interest rate comes down a bit in February, the benefits will take 6 to 9 months to reach the common man. “The interest rate cycle in India has been maintained nearly for a year now due to inflation. Inflation numbers are not really improving significantly. The comfort level of RBI is around 4% CPI and now it is around 6%. So it is around 50% more than what RBI prefers it to be. So the interest rate will remain elevated even if there is some kind of a rate cut in February. It may take a while for the interest rate (benefit) to come down to the common man because the transfer is not immediate. So it will take time. Whatever happens it will take 6 to 9 months,” he said.
One of the oldest and most prominent NBFCs in the country, Shriram Finance has finalised a grand entry into green vehicle financing while retaining its preeminent position in vehicle financing and leadership in two-wheeler financing, said Umesh Revankar, executive vice-chairman. Biz News Business News – Personal Finance News, Share Market News, BSE/NSE News, Stock Exchange News Today
