'Did not discuss': Shriram Finance on becoming a bank after Rs 39,620-cr MUFG investment

Shares of Shriram Finance hit their record high for the fourth straight session on Wednesday. Later, the stock ended 1.63% higher at Rs 973.60 in the current session. The stock hit a record high of Rs 983.35 today.

On December 19, the stock hit a record high of Rs 914.10 after the non-banking financial company (NBFC) said that Japan’s banking major, MUFG Bank, will acquire a 20 per cent stake in the company for Rs 39,620 crore, marking one of the largest foreign investments in India’s non-banking finance space this year. The Japanese financial major will buy shares at Rs 840.93 apiece, representing a discount of around 3% to the stock’s closing price on December 18.

Umesh Revankar, Executive Vice Chairman, Shriram Finance, said MUFG Bank has seen their business operation. "They have met the senior colleagues and depth in the management. They are quite happy the way we have built the business. And the uniqueness in the way Shriram has built the business gives them a confidence," Revankar said in an exclusive conversation with Business Today Group Editor Siddharth Zarabi.

On the possibility of becoming a bank in the future, Revankar said, "We did not discuss a single point on becoming a bank as far as the NBFC is concerned, because they were very happy with our infrastructure, our structure as a NBFC for delivering the credit."

"They felt that we are having the best possible way of direct approach with the customer and our business which we have built with the direct reach of the customer is much superior and they are quite happy with that and there is absolutely no discussion on becoming a bank as far as the NBFC is concerned, but Sridhar's own philosophy and thought process if you go back and see, we always maintain that what is good for the customer is good for us," added Revankar.