Shriram Transport Finance to roll out more auto malls

Truck financing company, Shriram Transport Finance Company, plans to roll out auto malls in Gurgaon-Manesar by the second week of July 2011, and in Mumbai by the end of this fiscal. It will be opening 50 more outlets across the country to sell pre-owned commercial vehicles by the end of this year, adding to its existing capacity of more than a 100 mini-malls.

In each location, the company will have “partner investors” responsible for installing the infrastructure.

Speaking to

Business Line , Mr U. G. Revankar, Deputy Managing Director, Shriram Transport Finance, said: “Although the market has slowed down, , with year-on-year growth being 12 per cent so far compared with 30 per cent last year, our business has not been impacted much since we are more into financing used vehicles.”

“At present, we are operating two auto malls in Chennai and Baroda. We will open two more in Gurgaon and Mumbai,” Mr Revankar told newspersons here.

He said the company lent Rs 19,000 crore in 2010-11, and was currently lending Rs 1,500-1,800 crore a month.

The company will be entering the debt market with a public issue of secured non-convertible debentures of Rs 1,000 crore comprising units of face value of Rs 1,000 each. The issue opens on June 27 and closes on July 9. The coupon rate will be 11-11.6 per cent.

“We are trying to woo retail investors by giving them the highest coupon rate. Unlike last time, when Rs 500 crore was split into 15 instruments, this time we are splitting Rs 1,000 crore into six instruments.

“So the investors can be assured of liquidity,” said Mr Kushagra Kumar, Associate (Investment Banking), JM Financial who, along with ICICI Securities Ltd, are lead managers to the issue.