Shriram Capital Ltd is keen on replicating its 50% compounded annual growth rate (CAGR) achieved in the last seven years by synergising the entire network through 33,000 employees, 6.5 million customer base and over 2,000 branches of geographical advantage. In an exclusive interview with R Ravichandran of FE, GS Sundararajan dwells in length on the group?s growth prospects. Excerpts:
The group has recently broad-based Shriram Capital board by inducting you as well Arun Duggal at the helm. What are your priorities?
We plan to enhance the synergies among all seven subsidiaries, expanding geographically, identifying niche areas, ensuring healthy growth, nurturing talent apart from playing strategic role among group companies in their growth plans. We add value that does not come in way of empowerment and will ensure the companies grow independently.
Eludicate your immediate action plans on this synergy?
Our immediate plan is to exploit the existing potential by cross selling each others? products and services, which have been not fully tapped so far. For example, only 8% of our staff strength has been covered with life insurance. When you think about the group staff strength and customer base, there is a huge potential to be tapped.
Similarly, we can synergise the activities of general insurance arm with that of transport and consumer finance arms for motor, credit and non-life insurance purposes. Shriram City Union Finance, which has been active in southern region, can be expanded geographically in a major way by tapping tier-I, II, III and IV cities with new branches as well as existing Shriram Transport Finance network.
What about your recent acquisition of GE?s transport and equipment portfolio?
Though it adds 2.5% to our existing AUMs, we feel it is a unique deal. As against a general tendency, an Indian asset company buying out a multinational?s portfolio is something very interesting and brings respectability to us. As a leading transport finance company, we believe it not only adds new customers under our belt but also helps us to grow more. It also brings value to our existing equipment financing business. We may float a separate subsidiary for equipment finance activities.
What are your plans for consumer finance growth?
Shriram City Union Finance is involved in financing enterprises (small and medium), gold, two-wheelers and used cars on a small scale. With its strong footing in the south, we plan to expand its base across the country. We are looking at Gujarat, MP, Chhattisgarh and Punjab on a pilot basis and based on the response, the company will roll out its operations across the country. Apart from opening new branches, the company will also utilise the existing set up of Shriram Transport Finance across the country. By 2011, Shriram Consumer Finance will have around 400 branches.
