Shriram Transport Finance Company Limited NCD
(i) Incorporated in 1979, Chennai based Shriram Transport Finance Company Limited is one of the largest asset financing non-banking finance companies in the organized sector in India that cater to first-time buyers (“FTB“) and small road transport operators (“SRTOs”) for financing pre-owned commercial vehicles. In addition, they provide commercial vehicle finance for new commercial vehicles. It also offers financial services to commercial vehicle operators, thereby providing comprehensive financing solutions to the road logistics industry in India.
(ii) The company has a long track record of over three decades in the commercial vehicle financing industry in India. It is a part of the Shriram group of companies, which has a strong presence in financial services in India, including commercial vehicle financing, consumer finance, life and general insurance, stock broking, chit funds and distribution of financial products, such as life and general insurance products and mutual fund products.
(iii) The company’s widespread network of branches across India has been a key driver of its growth over the years. As of March 31, 2018, it had 1,213 branches across India, including most of the major commercial vehicle hubs along various road transportation routes in India. It has also established its presence in 862 rural centers as of March 31, 2018, with a view towards increasing the market share in the pre-owned commercial vehicle market and reaching out to a relatively newer customer segment in rural areas.
Objective of NCD Shriram Transport Finance Company Limited NCD:
1. For the purpose of onward lending, financing, and for repayment/ prepayment of interest and principal of existing borrowings of the Company
2. General corporate purposes.
Shriram Transport Finance Company Limited – Tranche 3 Prospectus
Shriram Transport Finance Company Limited NCD Details:
| Open Date: | Jan 07 2019 |
| Close Date: | Jan 31 2019 |
| Issue Type: | Fixed Price Issue NCD |
| Issue Size: | ₹ 200-500 Cr. |
| Face Value: | ₹ 1000 Per NCD |
| Market Lot: | 1 NCD |
| Minimum Order Quantity: | 10 NCD |
| Listing At: | BSE |
Promoters:
The Promoter of the company is Shriram Capital Limited ("SCL"). SCL holds 5,91,73,023 Equity Shares in the Company aggregating 26.08% of the paid-up capital.
Financials:
| Year | AUM(Cr) | NIM(Cr) | Gross NPA | Net NPA |
| 2016 | 72762 | 5121 | 6.2 | 1.9 |
| 2017 | 78761 | 5521 | 8.2 | 2.7 |
| 2018 | 95306 | 6735 | 9.2 | 2.8 |
| Year | Current Ratio | Debt/Net Worth | Interest Coverage Ratio |
| 2016 | 0.98 | 3.30 | 1.35 |
| 2017 | 1.04 | 3.41 | 1.37 |
| 2018 | 0.99 | 3.81 | 1.41 |
Credit Rating:
Shriram Transport Finance Company Ltd Ratings
(i) CRISIL: These NCD issue are graded with CRISIL AA+/Stable for an amount of up to ₹ 5,00,000 lakhs dated June 8, 2018.
(ii) India Ratings & Research: These NCD are graded IND AA+: Outlook Stable for an amount of up to ₹ 5,00,000 lakhs dated June 8, 2018. Conclusion: The rating of the NCDs by CRISIL and India Ratings and Research indicate that instruments with this rating are considered to have a high degree of safety regarding timely servicing of financial obligations and carry very low credit risk.
Interest Rates:
| Series | I | II | III | IV | V |
| Interest Payment | Monthly | Monthly | Annually | Annually | Annually |
| Tenor | 5 Y | 10Y | 3Y | 5Y | 10Y |
| Minimum Application | 10,000(10 NCDs) | ||||
| Face Value | 1,000 | ||||
| Coupon (% per annum) for All Categories | 9.12% | 9.30% | 9.40% | 9.50% | 9.70% |
Post Tax returns:
(i) Sold after Maturity
The interest earned through NCDs will be added to the total income and will be taxed at 5%, 20%, and 30% respectively depending upon the income slab of an Individuals.
(ii) Sold Before Maturity
If you decide to sell the NCDs on the stock exchange, capital gains can also arise. If NCDs are sold within a period of 12 months from the date of allotment, short-term capital gains/loss (STCG) will arise and if you decide to sell NCDs after a period of 12 months, the resulting gain or loss is called long-term capital gains/loss (LTCG).
Recommendation:
Shriram Transport Finance Company Ltd NCD Rating by InvestorZone team =>4/10
[The current NCDs are secured, so even if the company not able to pay obligation due to default the investor's money will be returned back by selling all assets of the company. The Interest Rates are lucrative. The 3Y tenure with Annual Interest payment looks a good option.]
Lead Manager of Shriram Transport Finance Company Limited NCD:
- Edelweiss Capital Limited
Registrar of Shriram Transport Finance Company Limited NCD:
- Integrated Registry Management Services Private Limited
Discussion on Shriram Transport Finance Company Limited NCD:
6 Comments
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will Senior Citizen get extra 0.25% at the time of maturity or included in monthly/annual payout? is there any condition to hold the same till maturity for getting benefit of senior citizen?
Each application should be for a minimum of 10NCDs and multiples of one NCD thereof.
The minimum application size for each application would be 10,000(for all kinds of Series I, II, III, IV, V, VI and VII NCDs either taken individually or collectively) and in multiples of 1,000 thereafter.
What is the interest rates
Any review
I will do it on weekends.
Apply for 3Y tenure.