Shriram Finance, India's second-largest private sector non-banking finance company (NBFC), is setting ambitious targets for growth in several key lending segments. The company plans a significant push into passenger vehicle financing, alongside scaling up its gold loan and Micro, Small, and Medium Enterprises (MSME) businesses over the coming years.
Passenger Vehicle Finance: A Major Growth Driver
Executive Vice-Chairman Umesh Revankar highlighted the substantial opportunity in passenger vehicle (PV) lending. Despite commercial vehicle (CV) loans making up nearly 47% of its over Rs 3.13 lakh crore Assets Under Management (AUM) as of the April-June quarter, the company's market share in PVs (both new and used) currently stands at only around 5%.
Revankar stated, "We can double it to 10% by this financial year-end." He anticipates faster growth in the PV lending business due to this larger scope, particularly identifying rural areas as a prime expansion territory for these loans.
Expanding Gold Loan and MSME Portfolios
Beyond vehicle finance, Shriram Finance is also strategically scaling its gold loan business. Although gold loans constituted a smaller portion of its AUM at 2.39% in the June quarter, this figure has shown consistent growth from 1.89% a year ago. The overall gold loan market has seen robust expansion, with industry AUM growing from Rs 6.3 lakh crore in March 2023 to Rs 19.4 lakh crore by March 2026.
Revankar sees immense potential to tap into the existing customer base, many of whom may currently be availing gold loans from competitors or unorganised pawn brokers. The company plans to open more gold loan-specific branches, especially in residential areas with a high concentration of working-class households, to improve customer reach.
The MSME segment is another critical growth area. Despite exercising caution over the past year due to global trade uncertainties, Shriram Finance now aims to more than double its MSME loan book from approximately Rs 42,000 crore at the end of June 2026 to Rs 1 lakh crore within the next 3-4 years. Revankar noted the substantial credit gap in the MSME sector, estimated by the RBI at Rs 30 lakh crore, presenting a vast opportunity. The company plans to leverage its existing presence in industrial clusters and hire experts in supply chain finance and large-ticket MSMEs to achieve this goal.
Branch Network Expansion
Shriram Finance currently operates 3,250 branches and consistently adds 100-150 new branches annually. This expansion will continue, with a focus on establishing more specialty branches, such as those dedicated to gold loans, to cater to specific market needs and enhance customer accessibility for its diversified lending portfolio.