Original disclosure @ IFC website
Updated in EWS Jul 24, 2022
Disclosed by Bank Apr 7, 2022
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Accorrding to IFC, the proposed project envisages a rupee denominated investment into securitized assets of Shriram Transport Finance Company Limited (SHTF) through Pass Through Certificates (PTCs) of up to USD 300 million equivalent (of which up to USD150 million will be through IFC’s own account and remaining through mobilization). The proposed project supports vehicle financing for micro, small and medium enterprises (MSME), particularly the micro segment, with a focus on the low-income states (LIS) and rural regions of India. The Covid-19 pandemic has aggravated the already weak economic environment for this segment since they are less resilient to exogenous shocks. Thus, this investment is part of IFC’s systematic effort to infuse confidence back into the market through innovative capital market instruments such as securitizations. These instruments will provide liquidity to the extremely important MSME segment through NBFCs, and enable resilient business recovery.
The proposed project envisages a rupee denominated investment into securitized assets of SHTF through Pass Through Certificates of up to USD 300 million equivalent (of which up to USD150 million will be through IFC’s own account and remaining through mobilization).
SHTF is one of the largest asset-financing NBFCs in India with assets under management (AUM) of USD 16.6 billion (INR 1.24 trillion) as on 31 December 2021, with a very strong distribution network that caters to over 2.10 million customers through 1,834 branch offices and 792 rural centres across India. The company primarily lends to MSME clients in the transportation sector that are economically weak, have limited credit history and therefore are unable to raise funds from commercial banks.
SHTF is listed on the Bombay Stock Exchange and National Stock Exchange and has a market capitalization of USD 4.1 billion as of 31 March 2022. As of 31 December 2021, 26.06 percent of SHTF’s shares were held by the promoter & promoter group, 53.25 percent were held by foreign portfolio investors and foreign institutional investors, 14.69 percent were held by FIs (including insurance companies, banks and mutual funds), 5.69 percent were held by public shareholders, and 0.31 percent were held by others.
Shriram Transport Finance Company Limited
DGM – Corporate Finance and Treasury
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G Block, BKC, Bandra East, Mumbai 400051, Maharashtra, India
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