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Shriram Finance LtdQ3 FY24

Shriram Finance Ltd Q3 FY24 Earnings Call Analysis

Revenue, margin, capex, fundraise and order book outlook from management commentary.

Price: ₹945P/E: 20.7Market Cap: ₹2.3L CrSector: Finance

Management growth scorecard

Revenue

Category 3

Margin

Category 3

Fundraise

Yes

Order

N/A

Capex

Yes

2 of 4 growth signals are positive.

Full analysis

Revenue guidance

Category 3
  • Company guided for about 15% overall growth at the beginning of the year, with current growth around 20% AUM growth for the ongoing year, but longer-term guidance remains at 15% (Page 10,16).
  • Strong growth in personal loans (60-65%) driven by expanded distribution network (Page 17).
  • Gold loan product introduced in 600 CV branches, with plans to expand to another 600 next year, indicating continued growth potential (Page 17).
  • MSME loans expected to grow strongly, with phased recruitment and deployment of sales staff (Page 17).
  • Two-wheeler segment continues robust growth, driven by new markets such as Odisha, West Bengal, Northeast, UP, and MP; expected growth of around 25-30% going forward (Page 15,17).
  • Construction equipment and commercial vehicle segments expected steady growth: CV growth guidance maintained at 12-15% (Page 10,16).
  • Housing finance subsidiary growing strongly with 67.53% YoY AUM growth (Page 7).

See what Shriram Finance Ltd management said on margin guidance — free account, 30 seconds.

Fundraise plans

Yes
  • The company is actively looking at various options for capital infusion, especially for Shriram Housing Finance, due to its growth.
  • They are considering fundraising to provide growth capital but have not specified exact plans or timelines.
  • Incremental cost of borrowing has increased slightly to 8.95%, partly due to a mix of liabilities, including retail deposits, capital market borrowing, and external commercial borrowing (ECB).
  • Recently raised ECB of $750 million at a 6.625% coupon to enhance liquidity.
  • Liquidity coverage ratio and ALM surplus are strong, supporting funding needs.
  • No explicit mention of equity fundraising; focus appears on debt and other capital-raising alternatives.

See what Shriram Finance Ltd management said on order book — free account, 30 seconds.

Capex plans

Yes
  • The company is considering options for growth capital as part of its strategy, indicating potential future capital investments.
  • There is no explicit mention of current or immediate capex plans in the transcript.
  • Focus appears on expanding product distribution, such as introducing gold loans in additional branches and growing MSME loans through phased recruitment.
  • No detailed specifics provided on strategic investments or large-scale capex during the call.
  • The emphasis is on leveraging the merged entity's expanded network for organic growth rather than heavy capital expenditure.

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