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Shriram Finance Limited ( (IN:SHRIRAMFIN) ) has provided an update.
Moody’s Ratings has affirmed Shriram Finance Limited’s Ba1 long-term corporate family rating and revised its outlook on the company to positive from stable, reflecting expectations of a stronger business and financial profile. The outlook change is driven by MUFG Bank’s planned acquisition of a 20% stake in Shriram Finance via a substantial preferential share issue, which is expected to materially boost capitalization, enhance access to onshore and offshore funding, and improve funding diversity and risk management. On a pro forma basis, the capital infusion is projected to lift the firm’s tangible common equity to tangible managed assets ratio to above 29% from about 19%, with Moody’s expecting it to remain above 20% over the next four to five years, while profitability is anticipated to improve as funding costs decline and access to funding strengthens. Moody’s also expects Shriram Finance’s asset quality to stay stable, and notes that a future rating upgrade would depend on sustained profitability improvements, strong capital metrics and stable asset quality, although explicit affiliate support from MUFG is not currently factored into the rating.
More about Shriram Finance Limited
Shriram Finance Limited is a leading Indian non-bank finance company (NBFC) focused on lending activities, including retail and commercial credit, with a strong presence in the domestic financial services market. The company operates across India and relies on diversified funding sources to support its loan book and growth ambitions.
Average Trading Volume: 497,288
Technical Sentiment Signal: Buy
Current Market Cap: 1873.6B INR
See more insights into SHRIRAMFIN stock on TipRanks’ Stock Analysis page.