'Mitsubishi to power Shriram Finance's growth'

NEW DELHI: Capital infusion by Japan's Mitsubishi UFJ Financial Group (MUFG) will strengthen Shriram Finance's balance sheet as well as provide long-term growth capital. MUFG has said it will invest Rs 39,618 crore in Shriram Finance through a preferential allotment of equity shares, acquiring a 20% stake in the non-bank lender.

MUFG will make the investment by subscribing to new equity shares of Shriram Finance. The deal marks one of the largest foreign direct investments in India's non-banking financial sector. "MUFG and Shriram Finance share a common vision and aligned values for the future. Leveraging our global capabilities, MUFG is committed to supporting Shriram Finance's growth and contributing to economic development, communities, and society in India," said Hironori Kamezawa, group chief executive officer, Mitsubishi UFJ Financial Group, said.

On whether Shriram Finance plans to convert into a bank, Umesh Revankar, executive VC, Shriram Finance, said there was no such move at present. "There is no such plan at the moment as we have enough scope and opportunity to grow in existing line of business itself," he said. Revankar added that vehicle finance will remain a key focus area for the company. "We will be able to grow at 20% CAGR in the next four-to-five years in the vehicle finance portfolio," he said.


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