DCM STFC Sec III (IFC-47404)

Regions
  • South Asia
Geographic location where the impacts of the investment may be experienced.
Countries
  • India
Geographic location where the impacts of the investment may be experienced.
Financial Institutions
  • International Finance Corporation (IFC)
International, regional and national development finance institutions. Many of these banks have a public interest mission, such as poverty reduction.
Project Status
Proposed
Stage of the project cycle. Stages vary by development bank and can include: pending, approval, implementation, and closed or completed.
Bank Risk Rating
U
Environmental and social categorization assessed by the development bank as a measure of the planned project’s environmental and social impacts. A higher risk rating may require more due diligence to limit or avoid harm to people and the environment. For example, "A" or "B" are risk categories where "A" represents the highest amount of risk. Results will include projects that specifically recorded a rating, all other projects are marked ‘U’ for "Undisclosed."
Voting Date
Dec 16, 2022
Date when project documentation and funding is reviewed by the Board for consideration and approval. Some development banks will state a "board date" or "decision date." When funding approval is obtained, the legal documents are accepted and signed, the implementation phase begins.
Borrower
STFC SEC III SPV
A public entity (government or state-owned) provided with funds or financial support to manage and/or implement a project.
Sectors
  • Finance
  • Transport
The service or industry focus of the investment. A project can have several sectors.
Investment Type(s)
Loan
The categories of the bank investment: loan, grant, guarantee, technical assistance, advisory services, equity and fund.
Investment Amount (USD)
$ 300.00 million
Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.
Loan Amount (USD)
$ 300.00 million
Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.
Primary Source

Original disclosure @ IFC website

Updated in EWS Jan 4, 2023

Disclosed by Bank Nov 14, 2022

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Project Description
If provided by the financial institution, the Early Warning System Team writes a short summary describing the purported development objective of the project and project components. Review the complete project documentation for a detailed description.

According to IFC, the proposed project envisages a rupee denominated investment into securitized assets of Shriram Transport Finance Company Limited (STFC) 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. Through this project, IFC will provide liquidity to the extremely important MSME segment through NBFCs, and enable resilient business recovery.

Investment Description
Here you can find a list of individual development financial institutions that finance the project.
Private Actors Description
A Private Actor is a non-governmental body or entity that is the borrower or client of a development project, which can include corporations, private equity and banks. This describes the private actors and their roles in relation to the project, when private actor information is disclosed or has been further researched.

STFC is one of the largest asset-financing NBFCs in India with assets under management (AUM) of USD 16.5 billion (INR 1.35 trillion) as on 30 September 2022, with a very strong distribution network that caters to over 2.19 million customers through 1,854 branch offices and 758 rural centres across India. STFC 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.

STFC is listed on the Bombay Stock Exchange and National Stock Exchange and has a market capitalization of USD 4.0 billion as of 01 November 2022. As of 30 September 2022, 29.37 percent of STFC’s shares were held by the promoter & promoter group, 50.73 percent were held by foreign portfolio investors and foreign institutional investors, 14.19 percent were held by FIs (including insurance companies, banks and mutual funds), 5.35 percent were held by public shareholders, and 0.37 percent were held by others.                   

STFC is headquartered in Mumbai, Maharashtra and has 1,854 branches across India.        

Private Actor 1 Private Actor 1 Role Private Actor 1 Sector Relation Private Actor 2 Private Actor 2 Role Private Actor 2 Sector
- - - - Shriram Transport Finance Company Limited Client Transport

Contact Information
This section aims to support the local communities and local CSO to get to know which stakeholders are involved in a project with their roles and responsibilities. If available, there may be a complaint office for the respective bank which operates independently to receive and determine violations in policy and practice. Independent Accountability Mechanisms receive and respond to complaints. Most Independent Accountability Mechanisms offer two functions for addressing complaints: dispute resolution and compliance review.

Shriram Transport Finance Company Limited
Sandeep Balagopalan
AVP – Corporate Finance and Treasury
Fax: +91 22 40959596
sandeep@stfc.in
G Block, BKC, Bandra East, Mumbai 400051, Maharashtra, India
https://www.stfc.in/

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ACCOUNTABILITY MECHANISM OF IFC/MIGA

The Compliance Advisor Ombudsman (CAO) is the independent complaint mechanism and fact-finding body for people who believe they are likely to be, or have been, adversely affected by an IFC or MIGA- financed project. If you submit a complaint to the CAO, they may assist you in resolving a dispute with the company and/or investigate to assess whether the IFC is following its own policies and procedures for preventing harm to people or the environment. If you want to submit a complaint electronically, you can email the CAO at CAO@worldbankgroup.org You can learn more about the CAO and how to file a complaint at http://www.cao-ombudsman.org

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