Shriram Finance Ltd.

CARE has assigned ‘AA+’ rating to the NCD issue of Shriram Transport Finance Company (STFCL). The rating factors in Shriram Transport Finance Company’s (STFCL’s) dominant position and  more than three decades of experience in the pre-owned commercial vehicle (CV) financing  segment, its overall healthy profitability parameters, its strong resource raising capabilities and its  proactive and experienced management team.

The rating is, however, constrained by STFCL’s concentration in a single asset class and the underlying industry risk linked with its target customer segment of Small Truck Operators, which may be relatively more vulnerable to the economic downturn. 

STFCL is the flagship company of the Chennai-based Shriram group and is classified as deposit taking Asset Financing NBFC. The company was with an objective to provide hire purchase and lease finance for the medium and heavy commercial vehicles to individual truck operators. It is the largest asset financing NBFC in India concentrated mainly in the pre-owned vehicle financing business