Japan’s Mitsubishi UFJ Financial Group (MUFG) is poised to acquire around a 20% stake in Shriram Finance in a deal valued at over $4 billion, Reuters reported. Thetransaction is expected to be finalised on Friday, subject to approvals, as per Reuters.
While MUFG declined to comment on the development, Shriram Finance did not respond to queries. Reuters quoted sources and stated that the investment could be as high as $4.3 billion, or roughly Rs 39,000 crore, making it one of the largest foreign investments into India’s non-banking financial sector.
Part of Japan banks’ India push
The proposed investment underscores the accelerating push by Japanese financial institutions into India, as they seek growth opportunities beyond their home market, where an ageing population and slower economic expansion have limited prospects.
India’s expanding credit demand and fast-growing retail lending market have made it a preferred destination. Earlier this year, Sumitomo Mitsui Financial Group acquired a 24.2% stake in Yes Bank, beginning with a $1.6 billion investment for a 20% holding. Separately, Mizuho Securities announced on Wednesday that it would buy a majority stake in Indian investment bank Avendus from KKR for up to ¥81 billion ($523 million).
Deal size larger than earlier estimates
Bloomberg had earlier reported that MUFG’s investment in Shriram Finance could exceed $3.2 billion, but people close to the deal said the final amount would be significantly higher. Two sources independently confirmed that the investment would cross the $4 billion mark.
The discussions remain confidential, and the sources declined to be identified, the Reuters report added.
Board meeting signals fund-raising move
In a regulatory filing late Tuesday, Shriram Finance informed stock exchanges that its board would meet on Friday to consider and approve a proposal to raise funds. As per the Reuters report, the company did not provide further details in the filing.
Shriram Finance is among India’s largest retail-focused non-banking financial companies, with a strong presence in vehicle finance and personal loans, including credit for commercial vehicles, passenger cars and two-wheelers. As of the end of September, the company’s assets under management stood at Rs 2.8 trillion (about $31 billion), highlighting its scale in India’s retail credit ecosystem.
Shriram Finance share price
The share price of Shriram Finance is up 1% intra-day. Over a 1-month period the shares have jumped 5% and have yielded 47% returns so far in 2025.