Shriram City, founded in 1986, is a leader in retail financing and one of the country’s top lenders of MSMEs and two-wheelers. It also provides a variety of loan solutions for the acquisition of assets such as commercial vehicles, passenger vehicles, and house loans.
Furthermore, it provides loans against gold ornaments and for personal spending. Shriram City, a deposit-accepting NBFC, is part of the Shriram Group, which is celebrating its 45th year in business. The company has roughly 947 locations across India and reported Assets under Management of about Rs. 29085 crore for the fiscal year ended March 2020, with a current client base of nearly 40.76 lakh borrowers.
Shriram City Union Finance, a non-banking finance firm located in Chennai, is targeting total disbursements of Rs 22,000-23,000 crore in the current fiscal year, according to a top company executive. It disbursed Rs 4,560 crore in the first quarter of 2021-22, compared to Rs 6,570 crore in the March 2021 quarter.
Y S Chakravarti, the lender’s managing director and CEO, said July 2021 was a better month than June, with disbursements exceeding Rs 3,000 crore. Even the collecting efficiency had risen to over 100% in July, up from 93 percent in June.
According to Chakravarti, the disbursements averages around Rs 6,200-6,300 crore per quarter. We hope to reach around Rs 18,000-19,000 crore in the remaining three quarters. We should end up with Rs 22,000-23,000 crore (in disbursements) for the fiscal year .
Chakravarti stated that the company is seeing good demand from the SME and gold loan segments and will continue to focus on growing the book in those segments.
According to Chakravarti. For the past year and a half, we have taken a cautious approach to SME (finance). It has dropped from 55% to close to 49% right now. The goal is to get it back down to 55%.
Another important category for the institution is two-wheeler finance, which accounts for approximately 26-27 percent of its overall loan portfolio. He anticipates spending roughly Rs 1,500-1,600 crore in the two-wheeler industry in the current fiscal’s second quarter.
The lender declared a profit after tax of Rs 208 crore in the quarter ended June 2021, up from Rs 192 crore the previous year. Its asset quality improved year on year, with gross stage 3 levels at 6.91 percent in Q1 FY22 versus 7.28 percent the previous year.