Shriram Transport Finance - Healthy Q3; Sustainability Is The Key: Prabhudas Lilladher
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Prabhudas Lilladher Report
Shriram Transport Finance Company Ltd.’s performance stood robust across most key parameters (gross non-performing asset down 15 basis points QoQ/160 basis points YoY to 7.1% exclusive of Supreme Court order, disbursements up 10.5% YoY/95% QoQ) for Q3 FY21.
While cyclical recovery led by replacement demand pick up for used commercial vehicle financing should augur well for the company going forward, we would closely monitor borrower behavior (more than one installment payment, full payments, restructured accretion).
With operator's profitability yet to revert to pre-Covid-19 levels, certain stressed segments (aggregators/others) resulting into delinquencies would imply a plausible 150 basis points expansion in restructured book.
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