Shriram Finance Share Price Target

1. About the Company

In this blog we are predicting shriram Finance Share Price Target from 2024 to 2030 based on past performance and companies recent financial performance.

Shriram Finance Limited (SHFL) is one of India’s leading non-banking financial companies (NBFCs), specializing in vehicle financing and other retail lending products.

Formed through the merger of Shriram Transport Finance Company and Shriram City Union Finance, SHFL has established itself as a powerhouse in the financial services sector.

With a rich history dating back to 1974, SHFL has grown to become a trusted name in the industry, serving millions of customers across India.

The company’s primary focus is on providing financial solutions to the underserved segments of society, particularly in rural and semi-urban areas.SHFL’s extensive network of over 3,000 branches spans across the country, allowing it to maintain a strong presence in both urban and rural markets.

This wide reach, combined with its deep understanding of local markets and customer needs, has been instrumental in the company’s sustained growth and success.

2.Products – Detailed Analysis and Information

Shriram Finance offers a diverse range of financial products catering to various customer segments:

a) Vehicle Finance:

• Commercial Vehicle Loans: SHFL’s flagship product, financing new and used commercial vehicles.
• Passenger Vehicle Loans: For both personal and commercial use.
• Tractor Loans: Supporting the agricultural sector.
• Construction Equipment Loans: Aiding infrastructure development.

b) MSME Loans:

• Business Loans: Working capital and expansion financing for small businesses.
• Loan Against Property: Secured loans for business or personal needs.

c) Gold Loans:

• Quick and easy loans against gold jewelry.

d) Personal Loans:

• Unsecured loans for various personal needs.

e) Two-Wheeler Loans:

• Financing for motorcycles and scooters.

f) Fixed Deposits:

• Offering attractive interest rates for retail investors.

Product Analysis:

• Vehicle Finance remains the core strength, contributing about 80% of the AUM.
• MSME loans are showing strong growth, reflecting SHFL’s focus on diversification.
• Gold loans have seen a temporary decline due to LTV adjustments but are expected to pick up.
• Personal loans growth has moderated as the company takes a cautious approach in the current economic environment.

3. Results and Performance

Key Financial Information (in INR Crores):

Particulars	FY2024 (E)	FY2025 (E)	FY2026 (E)
Total Income	20,200	23,700	28,700
PPOP	14,200	16,600	20,400
PAT	7,190	8,390	9,950
AUM	224,862	267,639	314,165
NIM on AUM (%)	9.2	9.1	9.4
C/I ratio (%)	29.7	30.0	29.0
RoAA (%)	3.3	3.2	3.2
RoE (%)	15.7	16.2	16.8

Performance Analysis:

• Consistent growth in Total Income and PAT projected over the next three years.
• AUM expected to grow at a CAGR of ~18% from FY2024 to FY2026.
• Stable NIM and improving RoE indicate efficient operations and profitability.
• Slight increase in C/I ratio in FY2025 suggests investments in expansion and technology.

4. 52-week Stock Summary and Past 12-month Stock Performance

52-week Stock Summary:

• High: INR 3,652
• Low: INR 1,761
• Current Price: INR 3,091

Past 12-month Stock Performance (Monthly Open, High, Low, Close):

Based on the available search results, here are the monthly OHLC (Open-High-Low-Close) values for Shriram Finance in 2024:

Month	Open	High	Low	Close
December 2024	3,195.50	3,267.60	2,843.65	2,882.95
November 2024	2,926.95	3,079.30	2,926.95	3,046.35
October 2024	3,190.00	3,391.00	3,145.75	3,254.50
September 2024	3219.95	3,652.15	3,190.05	3,576.95
August 2024	3,234.30	3,262.65	3,174.65	3,199.55
July 2024	2,902.05	3,044.00	2,635.50	2,931.95
June 2024	2,479.35	2,546.95	2,193.00	2,497.95
May 2024	2,448.00	2,658.00	2,354.20	2,588.55
April 2024	2,510.55	2,578.80	2,429.95	2,518.85
March 2024	2,374.05	2,430.00	2,338.25	2,386.35
February 2024	2,411.00	2,535.00	2235.25	2438.60
January 2024	2,055.55	2,496.55	2,016.00	2,466.80

Please note that the data is incomplete for some months due to limitations in the provided search results. The table includes the available information for each month in 2024.

5. Share Price Targets

Predicted share price targets based on financials and estimated growth:

Year	Target Price (INR)	Reason for Upside
Shriram Finance Share Price Target 2024	4,000	Strong AUM growth, improving asset quality
Shriram Finance Share Price Target 2025	4,500	Expansion in non-vehicle finance segments
Shriram Finance Share Price Target 2026	5,100	Sustained profitability and market share gains
Shriram Finance Share Price Target 2027	5,800	Technology investments driving efficiency
Shriram Finance Share Price Target 2028	6,600	Deeper penetration in rural markets
Shriram Finance Share Price Target 2029	7,500	Diversification of product portfolio
Shriram Finance Share Price Target 2030	8,500	Economies of scale and improved cost ratios
Shriram Finance Share Price Target 2035	14,000	Long-term growth in financial inclusion
Shriram Finance Share Price Target 2040	22,000	Market leadership and brand value

Reasons for expected upside:

• Consistent AUM growth projected at 18-20% CAGR
• Improving asset quality and credit costs
• Diversification into high-yield products like MSME and gold loans
• Expansion of branch network and digital capabilities
• Potential credit rating upgrades reducing cost of funds
• Favorable government policies promoting financial inclusion
• Strong management team with proven track record

6. Key Management Personnel

• Y. S. Chakravarti: Managing Director & CEO
• Parag Sharma: Executive Director & CFO
• Umesh Revankar: Vice Chairman
• Arun Duggal: Non-Executive Chairman
• Maya S. Sinha: Independent Director
• S. Sridhar: Independent Director

7. Management Commentary

• Positive outlook on market demand, especially in rural and semi-urban areas
• Expectation of double-digit growth in vehicle finance segment
• Focus on expanding MSME and gold loan portfolios
• Confident of maintaining NIMs at current levels with potential for slight improvement
• Targeting to improve Stage 3 assets to 5%
• Emphasis on technology adoption for improved efficiency and customer experience
• Exploring opportunities for inorganic growth and strategic partnerships

8. Dividend History

Financial Year	Dividend Per Share (INR)	Dividend Yield (%)
FY2024 (E)	45	1.5
FY2023	35	1.1
FY2022	23	0.8
FY2021	21	0.7
FY2020	5	0.2

9. Corporate Action History

• October 2024: Announced stock split of 5:1
• September 2024: Raised USD 500 million through offshore bonds
• April 2023: Completed merger of Shriram Transport Finance and Shriram City Union Finance
• March 2022: Board approval for merger of group companies
• June 2021: Rights issue of equity shares

10. Key Conference Points

• AUM growth of 20% YoY to INR 2.43 trillion in Q2FY25
• Disbursements grew 16% YoY to INR 400 billion
• Asset quality improved with GS3/NS3 at 5.3%/2.7%
• Credit costs stable at 2.1% annualized
• Expansion of gold loan offerings to 1,400+ branches
• Focus on cross-selling opportunities and product diversification
• Positive outlook on CV and CE demand due to government infrastructure spending

11. Top 10 Shareholders

Shareholder	Stake (%)
Shriram Ownership Trust	25.4
Life Insurance Corporation of India	6.2
Government Pension Fund Global	3.8
SBI Mutual Fund	3.5
HDFC Mutual Fund	2.9
Vanguard Group	2.7
BlackRock Inc.	2.5
Nippon India Mutual Fund	2.3
Mirae Asset Global Investments	2.1
Kotak Mahindra Mutual Fund	1.9

12. FAQs

Q1: What is Shriram Finance’s primary business focus?
Shriram Finance primarily focuses on vehicle financing, especially commercial vehicles, along with MSME loans, gold loans, and personal loans.

Q2: How has the merger impacted Shriram Finance’s operations?
The merger has strengthened SHFL’s position in the market, allowing for a more diversified product portfolio and improved operational efficiencies.

Q3: What is the company’s strategy for growth in the coming years?
SHFL is focusing on expanding its non-vehicle finance segments, particularly MSME and gold loans, while maintaining its leadership in vehicle finance.

Q4: How is Shriram Finance addressing the challenges in the NBFC sector?
The company is maintaining a strong liquidity position, diversifying its funding sources, and focusing on asset quality to navigate sector challenges.

Q5: What is the company’s dividend policy?
SHFL has been consistently paying dividends, with a payout ratio of around 20-25% of profits.

Q6: How is Shriram Finance leveraging technology in its operations?
The company is investing in digital platforms for loan origination, customer service, and risk management to improve efficiency and customer experience.

Q7: What is the company’s approach to managing asset quality?
SHFL maintains a conservative approach to lending, with a focus on secured loans and robust underwriting practices to manage asset quality.

Q8: How does Shriram Finance plan to compete with banks in the vehicle finance space?
The company leverages its deep understanding of the sector, strong relationships with customers, and specialized products tailored for commercial vehicle operators to maintain its competitive edge.

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