Shriram Finance plans $300 million overseas borrowing by October-end: MD & CEO Y.S. Chakravarti

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Shriram Finance, the country’s largest retail asset finance company, plans to raise $300 million in dollar denominated borrowing by October-end to fund business growth, Y.S. Chakravarti, Managing Director & CEO, said.

This will be part of the $1.25-1.5 billion dollar denominated borrowing that the non-banking finance company (NBFC) plans to raise this fiscal, Chakravarti told businessline here.

“There is lot of interest in Indian debt among foreign investors now. We have already raised $350 million this fiscal. Another $300 million will be raised by October-end. It will be a mix of debt and bonds,” he added. 

Of the planned dollar denominated borrowing of $1.25-$1.5 billion, Shriram Finance can raise $750 million through the automatic route.

“For the balance, we will go to RBI for approval. Last year, RBI had approved borrowing of over $750 million. We hope to get approval for over $750 million this fiscal also,” he added.

RBI has told NBFCs that 20 per cent of incremental borrowing has to come from the market and not from the banks, which has put pressure on the NBFCs to tap markets for resources.

Education loans  

Shriram Finance plans todiversify into education loans in the next few months. “Policy, systems are in the works. It will be for funding skill enhancement courses. We will also provide education loans for study abroad (not for studies in the US ). We are looking at Australia, Singapore and other countries,” Chakravarti said.

The company is not looking to create a separate subsidiary for the education loan business, which would be part of Shriram Finance.

In the next one-and-half months, Shriram Finance also wants to extend supplier finance to small and medium businesses, he added.

Gold loans  

Chakravarti said the company wants to take gold loans to all the 3,100 branches across the country. Currently, its gold loan business is mainly in the southern States. “We want to take gold loans to all the existing branches of the company. We are not looking to set up any new branches only for gold loans. Currently, about 1,500 branches offer gold loans,” he added.

On electric vehicle financing, the company is funding such vehicles, battery infrastructure now and in next six months may set up a separate vertical, he said.