Shriram Finance Limited is a non-banking finance company in India. It provides loans for vehicles, farm equipment, and personal needs. It also offers fixed deposits and insurance products. Established in 1979 as Shriram Transport Finance Company, it rebranded in November 2022 and Shriram Finance Share is listed on NSE.
Description
Shriram Finance Share is a go-to choice for diverse financing solutions and impressive investment.
Key Facts
- Major institutional investors include Life Insurance Corporation of India and HDFC Life Insurance Company.
- The Shriram Group serves as the primary promoter, with several entities under its umbrella, like Shriram Capital Ltd.
- Individual investors such as R. Thyagarajan and A.R. Srinivasan also play a vital role.
- In total, 48.51% of shares are held by institutions, while 33.58% belong to insiders.
Exploring Shriram Finance Share
Generous Dividend Offer
Shriram Finance declared a 220% dividend, amounting to Rs 22 per share for the financial year 2024-25. This exciting payout highlights the company’s solid profits and commitment to shareholders.
Stock Split Strategy in October 2024
The company approved a 1:5 stock split, changing each share from Rs 10 to five shares worth Rs 2 each. This move aims to make the shares more affordable and attract a wider group of investors.
Strong Q2 Performance
For the second quarter of FY25, Shriram Finance reported a profit after tax of INR 20.7 billion, up 18% from the same quarter last year. Their net interest income increased by 16% to INR 56.1 billion, demonstrating effective financial management.
Significant Asset Growth
The company’s Assets Under Management (AUM) rose by 20% year-on-year, reaching INR 2.43 trillion. This growth largely came from their lending in the MSME sector, where loans surged by 52% year-on-year, along with strong growth in farm equipment and passenger vehicles.
Share Price Rally
After these announcements, Shriram Finance’s share price jumped 7% to Rs 3,313.65. This stock has gained 62% this year, significantly outpacing the 11% rise of the BSE Sensex.
Improved Asset Quality
The company improved its gross NPA ratio to 5.32%, showing better control over non-performing loans. Their net NPA ratio also decreased to 2.64%, indicating effective risk management.
Key Executives
Yalamati Srinivasa Chakravarti serves as the MD, CEO, and Director, earning ₹9.51 million. He was born in 1963. Umesh Govind Revankar, the Executive Vice Chairman, has a higher pay of ₹15.71 million and was born in 1964. Parag Sharma holds the position of MD, CFO, and Whole-Time Director, earning ₹9.47 million, and was born in 1969.
Future Expansion Plans
Shriram Finance aims to enhance its MSME and gold loan services. They plan to increase their gold loan branches from 500 to over 2,100, indicating a clear growth strategy for the future.
Exploring Shriram Finance Share
The company reported a debt-to-equity ratio of 1.73, indicating high leverage. Despite this, it has consistently achieved profit growth and paid dividends, attracting long-term investors. However, short-term investors face risks from interest rate fluctuations and growing competition. The company’s dividend yield remains appealing, providing regular income.
Brokerage JM Financial maintains a “BUY” rating with a target price of Rs 3,640. They emphasize Shriram Finance(https://www.youtube.com/@ShriramConnect) consistent growth, healthy profit margins, and strong asset quality, suggesting continued returns on investment and interest from investors.
Social Media Links
- Facebook(https://www.facebook.com/ShriramFinance)
- Instagram(https://www.instagram.com/shriramfinance)
- LinkedIn(https://www.linkedin.com/company/shriramfinance)
