Introduction: Shriram Finance, a prominent financial enterprise, has a rich history and a commitment to inclusion and sustainability. Let’s delve into their journey:
Establishment: In 1979, Shriram Transport Finance Company Limited (STFC) was founded. Their initial focus was on truck financing, catering to individual truck owners who often preferred purchasing pre-owned trucks1.
Diverse Services: Over the years, Shriram Finance expanded its offerings to include various financial services:
Commercial Vehicle Finance: Providing loans for commercial vehicles.
Passenger Vehicle Finance: Supporting vehicle purchases for individuals.
SME Finance: Assisting small and medium-sized enterprises.
Retail Lending: Offering personal loans, gold loans, and two-wheeler loans2.
Milestones:
1984: STFC had its Initial Public Offering.
1999: Tied up with Citicorp for CV financing under Portfolio Management Services (PMS) and executed the first securitization transaction.
2005-06: Merged with SIL and SOFL, with PAT crossing Rs. 1,000 million. Investment from ChrysCapital and TPG.
2009: Acquired hypothecation loan outstandings from GE Capital Services India and GE Capital Financial Services.
2010: Initiated financing of construction equipment.
2013: AUM crossed Rs. 500 billion.
2017-18: Raised funds through issuance of ‘Masala Bonds’ listed on the Singapore Stock Exchange.
2019-20: AUM surpassed Rs. 1 trillion.
2021-22: Issued USD 0.475 billion 4.15 percent Senior Secured Notes due 2025 (Social Bonds)1.
Vision: Shriram Finance’s presence spans rural India to cosmopolitan metros, unlocking value for generations to come3.
In summary, Shriram Finance’s journey is marked by trust, growth, and a commitment to serving diverse financial needs. 🌟🚚💰
Objective: To calculate the beta of Shriram Fianace and its significance.
View and Review:
” I have to thank Shriram Finance for providing my two-wheeler loan. Before working with Shriram Finance, I approached other lenders, none of them gave me any support when the loan process seemed to have a problem.” – Andy Nallappan, CTO and Head of Software Business Operations, Broadcom Software.
” I received the call from Shriram finance, they have offered me a personal loan which I accepted. The executive came and collected the documents the very next day. The process took only 48 hours and the loan amount got disbursed. The process was easy and no issues” -Kumar, Hyderabad.
Data Collection: The data is downloaded from the 1st of February 2023 to the 31st of January 2024 for Nifty 50 and Shriram Finance.
Nifty 50 is the independent variable.
Shriram Finance is the dependent variable.
ANOVA TABLE
Data Analysis
- The equation for the data is:
Shriram Finance stock = 1.2086 + 0.2091 Nifty 50
N= 48, R Square= 0.00646, F value= 0.29917
The above equation shows the relationship between Nifty 50 return and Shriram Finance’s stock return. Nifty 50 is the independent variable and Shriram Finance is the dependent variable.
- The positive sign in the equation means that there is a direct relationship between Nifty 50 and Equity of Shriram Finance. i.e. if the return of Nifty50 increases then the return of Shriram Finance will increase and vice versa.
- The number of observations is 48.
- R-square is 0. 00646which means 0.64% of Shriram Finance is explained by Nifty 99.4% are errors not in the model.
- Figures and brackets are the T stats is R-square. The P-value of this is 0.58704, it is more than 0.5 which means nifty 50 is statistically insignificant at the 5 % level.
- F is 0.29917 and the P-value is 0.58704 which is also more than 0.5 which means the overall model is statistically insignificant.
Conclusion: The beta is more than 1, therefore, we should not invest for long-term purposes.
https://www.nseindia.com/resources/historical-reports-capital-market-daily-monthly-archives
