Shriram Housing Finance Limited, a 77.25% subsidiary of Shriram City Union Finance Limited, is assigned ‘CRISIL AA/Stable’ for Rs 500 crore non-convertible debentures and Rs 1,000 crore long-term bank facilities by CRISIL.
As per CRISIL, “the rating centrally factors in expectation of strong financial, operational and management support from the parent, both on an ongoing basis and in the event of any distress. SHFL is also expected to benefit from the Shriram group’s ecosystem, which SHFL will further tap for business growth and operational efficiencies. SHFL’s capitalisation metrics are also adequate while the resource profile is diversified. However, these strengths are partially offset by modest asset quality, average profitability and limited track record post-revamp of business model.”
Mr Ravi Subramanian, MD & CEO, Shriram Housing Finance Limited, said, “We are pleased to receive ‘CRISIL AA/Stable’ rating to Rs 500 crore non-convertible debentures (NCDs) and Rs 1,000 crore long-term bank facilities. This shows how our experienced team has put in place adequate risk management processes and systems which help in scaling up our books and maintain the highest level of corporate governance.”
The main drivers for this rating are attributed to (i) Strong support from its parent, Shriram City and (ii) Adequate capitalisation and resource profile.
Shriram Housing Finance understands the aspirations of the under-served segment of the society of having a home of their own and customizes its products and services to help them realize their dream. It focuses on increasing the brand’s footprints in potential locations for deeper and wider penetration to ensure last mile distribution of the brand offerings and to be in sync with the Govt.’s mission of ‘Housing for All’ by 2022.
SHFL believes that the market and opportunities available in the housing finance domain are so huge that the Housing Finance Company doesn’t really need differentiating factor/USP to make productive use of it. The shortage in a housing unit is estimated over 2 crores on a conservative basis. Since Shriram Housing’s focus is on the grassroots and underserved segment, the future is very promising. The motto is ‘To find ways to fund Homes’ and focus on grassroots and under-served segment of society by devising customized credit assessment methods.