menu

Research

Credit Research

Nov 22nd 2021

Shriram Transport Finance Credit Analysis

linkedIn Logo
 
twitter logo

During Q2FY22, net interest income rose by 8.28% on yearly basis to Rs 47 billion during Q2FY22. In the same line net profit also increased by 12.66% during the same quarter. During H1FY22, net interest income moved up by 11.18% on yearly basis while net profit declined by 6.31%.

author dp
Subhasis Mishra

Shriram Transport Finance Company Ltd (STFCL) is a part of the Shriram group of companies, which has a strong presence in financial services in India, including commercial vehicle financing, consumer finance, life and general insurance, stockbroking, chit funds and distribution of financial products, such as life and general insurance products and mutual fund products.

The company was established in 1979 and it has a long track record of four decades in the commercial vehicle financing industry in India. The Company has been registered as a deposit-taking NBFC with the Reserve Bank of India (RBI) since 4 September 2000 under Section 45IA of the Reserve Bank of India Act, 1934.

 

The company is one of the largest asset financing non-banking finance companies in the organized sector in India that cater to first-time buyers (“FTB”) and small road transport operators (“SRTOs”) for financing pre-owned commercial vehicles. In addition, it provides commercial vehicle finance for new commercial vehicles. It is among the leading NBFCs in the organized sector for the commercial vehicle industry in India for FTBs and SRTOs.

 

Shriram Transport Finance Ltd has been assigned long term rating of AA+ by CRISIL, CARE and India Rating.

 

Financials Result

Parameters(billion)

FY20

FY21

NII

81.07

81.67

PAT

25.02

24.87

AUM

1097.492

1172.428

Net worth

179.77

215.407

NIM(%)

7.16%

6.70%

CRAR(%)

21.99%

22.50%

GNPA(%)

8.36%

7.06%

NNPA(%)

5.62%

4.22%

ROE(%)

14.71%

12.57%

 

 

Parameters(billion)

Q2FY21

Q1FY21

Q2FY22

NII

20.25

46.34

46.84

PAT

9.2

2.34

10.4

Net Worth

202.84

235.28

245.92

NIM(%)

6.66%

6.38%

6.44%

CRAR(%)

23.44%

23.27%

23.21%

GNPA(%)

6.50%

8.18%

7.82%

NNPA(%)

3.69%

4.74%

4.18%

 

 

Market Leadership: STFCL is one of the largest asset financing NBFCs. Its assets under management (AUM) rose by 7.32% to Rs 1216.4 billion as of Q2FY22 on yearly basis.

 

Robust Capitalization level: STFCL’s net worth rose to Rs 245.92 billion as of Sep’21 from Rs 215.40 billion as of Mar’21 which signifies adequate capitalization. As of 30th Sep 2021, its capital adequacy ratio stood at 21.06% from 21.05% as of 31st Mar 21.

 

Financial Performance: During Q2FY22, net interest income rose by 8.28% on yearly basis to Rs 47 billion during Q2FY22. In the same line net profit also increased by 12.66% during the same quarter.

During H1FY22, net interest income moved up by 11.18% on yearly basis while net profit declined by 6.31%.  

 

Asset Quality: STFCL’s gross NPA stood at 7.82% as of 30th Sep 2021 as compared to 7.06% as of FY21. During the same period, net NPA came down to 4.18% from 4.22% as of FY21.

 

 

Disclaimer:
Information herein is believed to be reliable but Arjun Parthasarathy Editor: INRBONDS.com does not warrant its completeness or accuracy. Opinions and estimates are subject to change without notice. This information is not intended as an offer or solicitation for the purchase or sale of any financial instrument. The financial markets are inherently risky and it is assumed that those who trade these markets are fully aware of the risk of real loss involved. Unauthorized copying, distribution or sale of this publication is strictly prohibited. The author(s) of the content published in the site INRBONDS.com may or may not have investments in the assets discussed in the pages/posts.

Copyright © INRBONDS.com by Arjun Parthasarathy 2021

report image

HDFC Ltd

Jun 22nd 2020

Subhasis Mishra

report image

Tata Steel Ltd.

May 21st 2021

C S S Nikhil Bhargav