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Informist, Monday, Dec. 22, 2025

 

--Shriram Finance Revankar: No plan to introduce new products right now 
--Shriram Finance Revankar: Saw 20-25% growth in vehicle loans post GST cut 
--CONTEXT: Shriram Finance Executive Vice Chairman Revankar at a press meet 
--Shriram Finance Revankar: To focus on semi-urban, rural mkt going ahead 
--CONTEXT: Shriram Finance MD & CEO Sharma speaks at press meet in Delhi 
--Shriram Finance Sharma: Expect cost of funds to come down after MUFG invest

 

NEW DELHI – Shriram Finance Ltd.'s cost of funds will come down with the possibility of a rating upgrade after Japan's MUFG Bank Ltd. decided to invest INR 396.18 billion in the company, Managing Director and Chief Executive Officer of the Indian non-banking financial company Parag Sharma said Monday. "We do expect rating to be upgraded. Given that we have an investor now which has a long-term perspective on the company, and a substantial equity investment which is happening, that will definitely help us for better rating and cost of funds to come down," he said.

 

Sharma, however, said it is difficult to quantify the decline in the potential cost of funds. "How much, I think I will not give a number as of now, but I think as and when we reach the highest rating. As of now, the differential between, the rating where we are right now, which is AA+, versus AAA, which is some other peers, the differential will be anywhere between 50-75%," Sharma told reporters at a press conference.

 

The Japan-based financial conglomerate had last week decided to buy 20% stake in the Shriram Finance MUFG Bank's stake purchase in Shriram Finance marks the largest foreign direct investment in a financial services company in India. The stake purchase is also the biggest investment for MUFG Bank's parent entity, Mitsubishi UFJ Financial Group, in India.  

 

Yasushi Itagaki, senior managing corporate executive, Group COO-I and Group Head of the Global Commercial Banking Business Group at MUFG Bank, said they do not have any plans at the moment to look for other investment opportunities. "Apart from Shriram Finance, for the moment we have no appetite to further expand our investment in the Indian financial services segment. We really stay focused, (will) work hard with Sriram Finance for the time being," he said.

 

Shriram Finance will utilise the additional capital to expand penetration of existing products into the semi-urban and rural market, Umesh Revankar, executive vice chairman at Shriram Finance Ltd. said. On being asked whether the non-banking financial institution will look to introduce new products, he said, "we have no such plans because we feel that there is enough scope and opportunity for us, using the knowledge base and expertise what we have. As and when we learn new things about the MUFG's investment in other countries, then we can re-look into it. Otherwise, currently, we believe that there is enough opportunity within the line of business."

 

Revankar said Shriram Finance has around 80% of business in semi-urban and rural and that will continue to grow. "In the last two years, we have had around 100 to 150 branches. We will open new branches in the next two years. And because of that, around 3,000 to 5,000 new employment will be generated," he said.

 

Shriram Finance expects robust growth in the near future in the vehicle financing space, especially after the goods and services tax reduction in September. The GST cut has created a bigger demand. And since October there has been 20-25% growth, Revankar said.

 

At 1520 IST, shares of Shriram Finance were at INR 934 on the National Stock Exchange, up 3.6% from the previous close.  End

 

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

 

Reported by Sagar Sen 

Edited by Vandana Hingorani

 

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