Shriram Finance Limited (SHRIRAMFIN) AI Stock Analysis

• Market Cap: ₹1.92T
• Dividend Yield: 1.08%
• Average Volume (3M): 235.05K
• Price to Earnings (P/E): 21.0
• Beta (1Y): 1.66
• Revenue Growth: 21.24%
• EPS Growth: 22.61%
• Country: IN
• Employees: 79,872
• Sector: Financial
• Sector Strength: 70
• Industry: Financial - Credit Services
• EPS (TTM): 13.39
• Shares Outstanding: 1,881,488,400
• 10 Day Avg. Volume: 215,751
• 30 Day Avg. Volume: 235,047
• PEG Ratio: 0.42
• Price to Book (P/B): 2.13
• Price to Sales (P/S): 2.95
• P/FCF Ratio: -2.73
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: ₹1,200.00
• Price Target Upside: 18.95% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 4
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 67 Neutral
• Price Target: ₹1,104.00 ▲(9.44% Upside)

Shriram Finance Limited's stock score is driven primarily by its strong financial performance, despite high leverage and negative cash flows. The technical analysis indicates strong bullish momentum, although overbought conditions may lead to a short-term correction. The valuation is reasonable, with a fair P/E ratio and modest dividend yield.

Positive Factors

Diversified lending franchise

A broad product mix across commercial vehicles, personal and SME lending reduces concentration risk and supports stable origination volumes. Diverse loan streams enable cross‑sell, resilient fee income and scale benefits from the branch/network footprint over multiple cycles.

Robust revenue expansion

Material revenue growth reflects sustained demand and successful penetration of target segments. Larger book size improves economics via fixed cost leverage and funding access, supporting long‑term ability to invest in distribution and technology that underpin durable topline growth.

Improving profitability and ROE

Rising ROE and margin expansion indicate better pricing, credit selection and cost management. Improved profitability enhances internal capital generation potential and investor returns, strengthening the franchise's ability to absorb shocks and fund growth without immediate reliance on external equity.

Negative Factors

High financial leverage

Elevated leverage increases interest expense sensitivity and refinancing risk, especially for a lending franchise dependent on wholesale funding. High debt magnifies earnings volatility and constrains strategic flexibility, raising the cost of capital and stress vulnerability over the medium term.

Poor cash conversion

Negative operating and free cash flow mean reported profits are not reliably converting to cash, forcing dependence on external financing to fund growth and liabilities. This impairs the company's ability to self‑fund investments and increases liquidity risk across funding cycles.

Operational earnings volatility

Inconsistent EBITDA points to variable underwriting results, cost swings or cycle‑sensitive performance. Such volatility complicates credit assessment, capital planning and margin sustainability, weakening predictability of earnings and making long‑term strategic execution harder.

Shriram Finance Limited Business Overview & Revenue Model

Company Description

Shriram Finance Limited, a non-banking finance company, primarily provides commercial vehicle financing services in India. It offers commercial vehicle loans for commercial goods vehicles, passenger vehicles, tractors and farm equipment, and construction equipment. The company also provides business loans; fixed and recurring deposits; and working capital loans, including tyre, tax, fuel, and toll finance, as well as vehicle insurance and repair/top-up loans. In addition, it offers challan discounting services; life and general insurance products; consumer finance services; emergency credit line guarantee schemes; stock broking services; and chit and mutual funds. As of March 31, 2022, it operated a network of 1,854 branches. The company also offers its products through 775 rural centers; and partnerships with 500 private financiers. It primarily serves first time buyers, driver-turned-owners, and small road transport operators. The company was formerly known as Shriram Transport Finance Company Limited and changed its name to Shriram Finance Limited in November 2022. Shriram Finance Limited was incorporated in 1979 and is headquartered in Mumbai, India.

How the Company Makes Money

Shriram Finance generates revenue through multiple streams, primarily from interest income on loans provided to customers. The company finances commercial vehicles, personal loans, and SME loans, charging interest rates that reflect the risk associated with each customer segment. Additionally, Shriram Finance earns fees from processing loan applications and other financial services. Insurance products, offered in partnership with insurance providers, also contribute to the revenue through commissions and service fees. The company's extensive network and strong brand reputation allow it to maintain a steady flow of customers, thereby enhancing its earnings potential.

Shriram Finance Limited Financial Statement Overview

Summary

Shriram Finance Limited demonstrates strong revenue and profit growth, indicative of successful business operations. However, high leverage and negative cash flows present potential risks. The company needs to focus on improving cash generation and managing debt to enhance financial stability and sustain long-term growth.

Income Statement

Shriram Finance Limited has shown notable revenue growth from ₹161.13 billion in 2024 to ₹411.24 billion in 2025. The net profit margin improved significantly, indicating enhanced profitability. Gross profit margin also increased, highlighting better cost management. However, fluctuating EBITDA over the years suggests some operational instability.

Balance Sheet

The company's debt-to-equity ratio remains high due to substantial total debt levels, which may pose financial risks. However, the equity ratio indicates a stable capital structure. Return on Equity has improved, reflecting better utilization of shareholder funds. Overall, the balance sheet shows a mix of financial leverage and improved shareholder returns.

Cash Flow

Shriram Finance has faced challenges in generating positive operating cash flow, resulting in negative free cash flow. The free cash flow to net income ratio is unfavorable, indicating potential issues in converting income into cash. However, financing activities have provided necessary liquidity, albeit with an increased debt load.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	425.47B	406.43B	338.86B	298.62B	192.88B	166.83B
Gross Profit	228.21B	221.88B	190.83B	169.31B	95.53B	76.28B
EBITDA	134.07B	131.48B	102.52B	88.14B	36.85B	34.15B
Net Income	96.90B	95.54B	73.66B	60.11B	27.21B	24.99B
Balance Sheet
Total Assets	0.00	2.94T	2.48T	2.11T	1.42T	1.30T
Cash, Cash Equivalents and Short-Term Investments	0.00	197.79B	111.73B	104.90B	112.88B	114.49B
Total Debt	0.00	1.78T	1.51T	1.29T	929.19B	903.66B
Total Liabilities	-564.70B	2.37T	1.99T	1.67T	1.16T	1.08T
Stockholders Equity	564.70B	564.70B	489.47B	435.13B	260.94B	217.17B
Cash Flow
Free Cash Flow	0.00	-439.07B	-313.67B	-178.22B	-88.95B	-42.65B
Operating Cash Flow	0.00	-436.83B	-311.01B	-176.25B	-88.59B	-42.39B
Investing Cash Flow	0.00	36.61B	-2.58B	-1.93B	-343.30M	-248.90M
Financing Cash Flow	0.00	445.21B	276.09B	118.20B	85.05B	122.26B

Shriram Finance Limited Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1008.80
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IN:SHRIRAMFIN, the sentiment is Positive. The current price of 1008.8 is above the 20-day moving average (MA) of 996.58, above the 50-day MA of 930.78, and above the 200-day MA of 727.62, indicating a bullish trend. The MACD of 23.34 indicates Positive momentum. The RSI at 66.96 is Neutral, neither overbought nor oversold. The STOCH value of 88.67 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for IN:SHRIRAMFIN.

Shriram Finance Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CHOLAFIN	73 Outperform	₹1.38T	28.33	―	0.12%	27.30%	20.42%
MAHABANK	71 Outperform	₹501.64B	7.75	―	2.60%	18.36%	14.53%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
SHRIRAMFIN	67 Neutral	₹1.92T	20.96	―	1.08%	21.24%	22.61%
MFSL	59 Neutral	₹556.14B	343.37	―	―	-16.19%	-53.19%
LICHSGFIN	55 Neutral	₹289.53B	5.28	―	1.87%	4.79%	13.08%
MANAPPURAM	49 Neutral	₹241.06B	59.06	―	0.80%	-3.68%	-80.12%

Shriram Finance Limited Corporate Events

Shriram Finance Faces GST Penalty Orders Linked to Amalgamated Entity

Shriram Finance Limited has disclosed that the Office of the Commercial Tax Officer, Chennai South, has issued orders levying tax and equal penalty demands totaling Rs 1.05 crore for FY 2020-21 and Rs 50.35 lakh for FY 2021-22, arising from alleged wrongful input tax credit on reverse charge mechanism payments and issues related to credit notes pertaining to the erstwhile Shriram City Union Finance Limited. The company has stated that these GST-related demands and penalties, issued under the Central, Tamil Nadu and Integrated Goods and Services Tax Acts, are not expected to have a material impact on its financial or operational performance, and it is seeking expert tax advice on the Tamil Nadu state demand orders as a matter of commercial prudence, a step closely watched by investors for any potential contingent liability implications.

Shriram Finance Gains S&P Upgrade to Investment-Grade BBB- Rating

Shriram Finance Limited announced that S&P Global Ratings has upgraded the company’s long-term issuer credit rating and senior secured debt rating to BBB-/Stable from BB+/Stable, and its short-term issuer credit rating to A-3 from B. The move to investment-grade territory signals an improvement in the company’s credit profile and risk perception, which could lower its funding costs, enhance market confidence, and strengthen its position among domestic and international lenders and investors.

Moody’s Turns Positive on Shriram Finance as MUFG Stake Bolsters Capital and Outlook

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.

Shriram Finance Reports All Physical Share Re-Lodgement Requests Rejected Under SEBI Special Window

Shriram Finance Limited has disclosed the outcome of a special window, mandated by a recent SEBI circular, for re-lodgement of transfer requests of physical shares between 7 July 2025 and 6 January 2026. During this period, its registrar, Integrated Registry Management Services, received four such transfer requests, all of which were ultimately rejected because the transferees failed to provide authentic proof of beneficial ownership and submitted documents with technical deficiencies, leaving no physical share transfer requests approved as of the reporting date.

Shriram Finance files business update call transcript with exchanges

Shriram Finance Limited has submitted to the stock exchanges the transcript of its December 30, 2025 business update conference call, following an earlier disclosure of the call’s audio link. The company has also made the transcript available on its website, enhancing transparency and access to its management’s latest commentary for investors and other stakeholders.

Shriram Finance Secures CARE AAA Rating for Fixed Deposit Programme

Shriram Finance Limited has received a top-tier credit rating of ‘CARE AAA; Stable’ from CARE Ratings Limited for its fixed deposit programme, indicating the highest degree of safety regarding timely servicing of financial obligations. The new rating, formally communicated on 30 December 2025, enhances the company’s funding profile and is likely to strengthen investor confidence in its deposit schemes, supporting its ability to mobilise retail funds while reinforcing its standing in the Indian non-banking financial sector.

Shriram Finance Declares 240% Interim Dividend for FY 2025-26

Shriram Finance Limited has announced the payout of an interim dividend of 240%, equating to Rs.4.80 per equity share, for the financial year 2025-26. This dividend, declared by the Board of Directors on October 31, 2025, has been distributed to eligible members as of November 17, 2025, marking a significant return to shareholders and reflecting the company’s robust financial health.

Shriram Finance Releases Q2 FY’26 Earnings Call Transcript

Shriram Finance Limited has released the transcript of its investor earnings call for the second quarter and half year ending September 30, 2025. This release provides stakeholders with insights into the company’s financial performance and strategic direction, reflecting its ongoing commitment to transparency and communication with investors.

Shriram Finance Publishes Postal Ballot Notice Advertisements

Shriram Finance Limited has announced the publication of newspaper advertisements regarding a Postal Ballot Notice under Section 110 of the Companies Act, 2013. These advertisements have been published in ‘Financial Express’ in English and ‘Makkal Kural’ in Tamil, and are also available on the company’s website. This move is part of the company’s compliance and communication efforts with its stakeholders, ensuring transparency and adherence to regulatory requirements.

Shriram Finance Releases Q2 Earnings Call Audio

Shriram Finance Limited announced the availability of an audio recording of their earnings call for the second quarter ended September 30, 2025, on their website. This move indicates transparency and accessibility for stakeholders, allowing them to stay informed about the company’s financial performance and strategic direction.