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Shriram Transport Finance NCD Review (Price, DRHP)

Shriram Transport Finance NCD Review pic

As a part of the Shriram group of companies, Shriram Transport Finance has established a long track record over three decades from the year 1979. It is India’s one of the largest asset financing non-banking finance company. They also provide finance for new finance vehicle. Besides this, it also finances for commercial vehicles, three-wheelers, multi-utility vehicles, tractors as well as parts or equipment of vehicles. Commercial vehicle operators also include in their finance category. The article is all about Shriram Transport Finance NCD Review but before proceeding, information regarding issue details is important.

About Shriram Transport Finance-NCD Issue Details

  • Issue open on-Jan 7, 2019
  • The issue close on- Jan 31, 2019
  • Issue Type: Fixed Price Issue NCD
  • Face value: Rs 1000 per NCD
  • Issue size: 7,000,000 NCD’s of Rs. 1000
  • Issue size: Rs. 700.00 Crore
  • Issue price: Rs 1000 per NCD
  • Market lot: 1 NCD
  • Listing At: BSE, NSE
  • Minimum order quantity: 10 NCD
  • DRHP: Click here

Purpose of Issuing NCD

The purpose of issuing stocks is quite important for understanding the objective of the company. The purpose is as follows:

  • If a company wants to raise the fund but without raising its share capital, they issue NCD (Non-Convertible Debenture)
  • Debenture holders get higher interest rate than convertible debentures and get liquidity from the company.
  • Issuing NCD can enhance a company’s corporate image, brand name.
  • Using the public fund, collected by NCD, a company can expand its business.

About Shriram Transport Finance

  • As of March 31, 2018, in India, it has 1,213 branches.
  • It has some of the commercial vehicle hubs as well as different road transportation routes in India.
  • As of March 31, 2018, the company has left its footprint in 862 rural centers.
  • The total number of employees on the company’s payroll was 23,819 (as of March 31, 2018)
  • Shriram Capital Limited is the promoter of the company, holds 5,91,73,023 equity shares in the company which is aggregating 26.08% of the paid-up capital.

Management Group

  • Chairman & Ind Director: S Lakshminarayanan
  • Director: D V Ravi
  • Independent Director: Amitabh Chaudhry

Financial Information

Now, let’s come to the very important part of the analytical review that is financial information.

Shriram Transport Finance limited

Shriram Transport Finance NCD Review:

From the above financial statement, we can get the quarter ended financial statement. The net profit amount has been increased in the 2018 quarter from the previous year. Now, move on to the DRHP or draft red herring prospectus. From there we can get other fundamental data regarding the company’s financials. According to the last FY2017-18, EPS stands at 69.11 (as per basic calculation). Net Asset Value/Share is at 554.13 as per the last FY and that is quite higher than the previous year data. If you want to go through the company details, you can follow the DRHP. Lastly, come to the review part. Based on the available data, Shriram Transport Finance NCD Review carries a NEUTRAL view. Investors can buy at their own risk.

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