Shriram Transport Finance Managing Director UMESH REVANKAR, in an interview with Krishna Pophale, says the company has lowered its loan-to-value ratio to protect asset quality.
When question was asked that “The Reserve Bank of India has tightened the norms for private placement of non-convertible debentures (NCDs). How is this affecting Shriram’s fund-raising plans? “. He replied, “It is not affecting us much because we are securing resources through deposits, as well as NCDs, as we are a deposit-taking NBFC (non-banking financial company). We felt NCDs were superior products, as these offered some security to the investor and we didn’t have to put 15 per cent in the statutory liquidity ratio (SLR), as its yields were very low. Now, we are shifting to deposits. Whenever customers want to invest some money, we are offering them deposits. So, there isn’t much impact. The Reserve Bank of India has tightened the norms for private placement of non-convertible debentures (NCDs). How is this affecting Shriram’s fund-raising plans? It is not affecting us much because we are securing resources through deposits, as well as NCDs, as we are a deposit-taking NBFC (non-banking financial company). We felt NCDs were superior products, as these offered some security to the investor and we didn’t have to put 15 per cent in the statutory liquidity ratio (SLR), as its yields were very low. Now, we are shifting to deposits. Whenever customers want to invest some money, we are offering them deposits. So, there isn’t much impact”.
In Answering the question on first quarter growth in both profit and assets under management were flat, while non-performing assets (NPAs) increased so is there difficult times to continues or not, replied, “Things have become much more difficult in the second quarter. The rupee is depreciating. Fuel prices are going up, and are likely to rise further. That is likely to put constraints on the earnings of transporters. Second, there isn’t enough load because the industrial manufacturing side is not really seen reversing. Power is inadequate. Even scale industries aren’t able to meet.
