Shriram Finance FY25 Results: Rs 9,761 Cr Profit with 35.75% Growth, 17% AUM Surge & ESG Focus

NEW DELHI (India CSR): For millions across India, access to financial services is a pathway to progress, fostering ambition and building resilience. In this dynamic landscape, Shriram Finance Limited (SFL) has consistently emerged as a beacon of trust and growth. The company’s recently unveiled Annual Report for the Financial Year 2024-25 paints a vivid picture of remarkable financial strength and strategic foresight, underscoring its unwavering commitment to empowering individuals and businesses. This past fiscal year has been particularly transformative for Shriram Finance, marked by robust growth, prudent management, and pivotal decisions that are set to redefine its trajectory and solidify its position as a leading Non-Banking Financial Company (NBFC) in the nation. The results are not just numbers; they represent the tangible impact of tailored financial solutions reaching underserved communities and contributing significantly to India’s economic fabric.

Shriram Financial Highlights

A Year of Unprecedented Financial Triumph

Shriram Finance Limited demonstrated an impressive financial performance in FY 2024-25, showcasing its disciplined execution and a keen focus on sustainable growth. The company’s total income, including exceptional items, surged by a significant 25.10%, reaching Rs. 43,783 crore fifty-two lakh in FY 2024-25, up from Rs. 34,997 crore sixty-one lakh in the previous fiscal year, FY 2023-24. Focusing solely on operations, the income from operations also witnessed a healthy 19.65% growth, moving from Rs. 34,964 crore forty-one lakh to Rs. 41,834 crore forty-two lakh.

The most striking highlight in its financial statement is the substantial rise in net profit after tax (PAT), which climbed to an impressive Rs. 9,761 crore in FY 2024-25, a robust 35.75% increase from Rs. 7,190 crore forty-eight lakh recorded in FY 2023-24. This exceptional profitability was further mirrored in the Earnings Per Share (EPS), which rose by 35.46% to Rs. 51.92 in FY 2024-25, compared to Rs. 38.33 in the prior year. The profit before tax also saw a significant jump, reaching Rs. 12,606 crore two lakh in FY 2024-25, up from Rs. 9,683 crore sixty-four lakh in FY 2023-24. This strong performance underscores the company’s ability to not only navigate market challenges but also to deliver consistent, profitable growth, reinforcing the resilience of its business model.

Robust Assets Under Management and Improving Asset Quality

A key indicator of Shriram Finance’s expanding footprint and operational success is its Assets Under Management (AUM). As of March 31, 2025, the AUM reached an impressive Rs. 2 lakh sixty-three thousand one hundred ninety crore twenty-seven lakh, marking a substantial 17.05% year-on-year increase from Rs. 2 lakh twenty-four thousand eight hundred sixty-one crore ninety-eight lakh as of March 31, 2024. This growth is a testament to the company’s ability to deepen its penetration into both urban and rural markets, supporting a wide and diverse customer base of over 95.56 lakh individuals through its extensive network of 3,220 branches across India.

Complementing this asset growth, Shriram Finance also demonstrated a marked improvement in its asset quality. The Gross Non-Performing Assets (GNPA) ratio reduced to 4.55% in FY 2024-25 from 5.45% in the previous fiscal year. Similarly, the Net Non-Performing Assets (NNPA) ratio saw a slight reduction to 2.64% in FY 2024-25 from 2.70% in FY 2023-24. These improvements highlight the effectiveness of the company’s upgraded collection framework and enhanced risk management practices. While the Net Interest Margin (NIM) experienced a marginal dip to 8.55% in FY 2024-25 from 8.84% in the prior year, this was primarily attributed to higher liquidity at the year-end, reflecting a prudent Asset-Liability Management (ALM) policy for sustained financial stability.

Operational & Portfolio Metrics

Strategic Portfolio Optimization and Shareholder Value Creation

FY 2024-25 was a pivotal year for Shriram Finance, characterized by strategic decisions aimed at optimizing its portfolio and enhancing shareholder value. A significant move was the successful divestment of its entire stake in Shriram Housing Finance Limited (SHFL), now known as Truhome Finance, to Warburg Pincus. This transaction, valued at Rs. 3,929 crore three lakh, resulted in a one-time exceptional gain of Rs. 1,656 crore seventy-seven lakh (Rs. 1,489 crore thirty-nine lakh net of tax) for the company. This strategic exit is expected to allow SHFL to flourish independently while enabling Shriram Finance to sharpen its focus on core capabilities and building a stronger financial framework for India’s future.

In a move to increase market liquidity and encourage wider investor participation, the company also facilitated a sub-division/split of the face value of its shares from Rs. 10 to Rs. 2 (a 5:1 split), effective January 10, 2025. Shareholders also benefited from substantial interim dividends, including 220% in Q2 and 125% in Q3. With a recommended final dividend of Rs. 3 per equity share (post-split), the total dividend for FY 2024-25 will amount to Rs. 9 and ninety paise per share (after adjusting for the split). These actions collectively underscore the company’s commitment to delivering value to its shareholders.

Product-Wise AUM Breakdown

Diverse Product Portfolio and Future Growth Pillars

Shriram Finance’s sustained growth is rooted in its diverse product suite, tailored to meet the unique needs of a wide range of customers. The company offers solutions spanning pre-owned vehicle finance, personal loans, farm equipment loans, and more, all designed with a focus on financial inclusion and customization. The Commercial Vehicle Loan segment continues to be the largest contributor to AUM, standing at Rs. 1 lakh eighteen thousand five hundred sixty crore fifty lakh, accounting for 45.05% of the total AUM as of March 2025. Other significant segments include:

• Passenger Vehicle Loans: Rs. 54,104 crore forty-nine lakh
• MSME Loans: Rs. 37,413 crore fifty-five lakh
• Two-Wheeler Loans: Rs. 15,580 crore fifty-six lakh, representing 5.92% of total AUM
• Construction Equipment Loans: Rs. 17,878 crore sixteen lakh
• Personal Loans: Rs. 9,609 crore seventy-one lakh, making up 3.65% of total AUM
• Gold Loans: Rs. 4,836 crore seventy lakh, comprising 1.84% of total AUM
• Farm Equipment Loans: Rs. 5,206 crore sixty lakh

The company has successfully expanded the reach of its gold loan offerings to over 1,000 branches. Looking ahead, Shriram Finance is not just resting on its laurels. It is actively strengthening electric vehicle (EV) financing solutions to support the shift towards sustainable transportation and is enhancing its digital infrastructure to streamline loan processing for a faster, more seamless customer experience. The launch of Shriram Green Finance as a new business vertical, with an ambitious target to build an AUM of Rs. 5,000 crore over the next three to four years, further underscores its commitment to sustainable development and future-oriented growth.

Operational Excellence and Digital Transformation

Shriram Finance attributes its strong performance to operational efficiencies driven by accelerated digital transformation. The company has initiated a complete paperless process for onboarding, underwriting, and disbursal across its “Shriram Super Web” and “Shriram One App” platforms, integrating over 30 digital loan journeys. This digital push has not only enhanced customer experience but also led to increased online transaction volume, reduced errors, and faster turnaround times. Its digital prowess is recognized in the industry, ranking 40th in UPI transactions and under 20th in BBPS transactions, ahead of many major players.

Despite facing challenges like increased Costs of Funds (CoF) due to regulatory updates and a broader sector-wide moderation in AUM growth (anticipated at 15-17% for NBFCs over the next fiscal years), Shriram Finance has strategically adapted. The Reserve Bank of India’s (RBI) sharpened regulatory oversight through the Scale-Based Regulation (SBR) framework has also reinforced sector stability, which Shriram Finance has diligently complied with, being categorized in the Upper Layer (NBFC-UL).

Sustainability & CSR Highlights

Commitment to ESG and Human Capital

Beyond financial metrics, Shriram Finance is deeply committed to environmental, social, and governance (ESG) principles. It recognizes its responsibility in shaping a sustainable future and aims to create a positive environmental and social impact through responsible business practices. The company has established a dedicated ESG Committee and formalized its commitment through an ESG Charter. Key highlights of its ESG efforts in FY 2024-25 include:

• Earning a strong ESG Impact Rating from ICRA, reflecting deep integration of ESG practices.
• Demonstrating a low operational environmental footprint as an NBFC.
• Actively improving resource efficiency through LED lighting, energy-efficient ACs, sensor-based taps, and promoting paperless operations and video conferencing.
• Tracking Scope 1, 2, and 3 emissions across 3,220 branches and offices, successfully reducing financed emission intensity by over 10% from 111.2 tCO₂e/Rs. crore in FY 2021–22 to 99.9 tCO₂e/Rs. crore in FY 2023–24.
• Supporting Electric Vehicles (EVs), renewable energy products, and eco-friendly infrastructure through its green financing strategy.
• Investing significantly in Corporate Social Responsibility (CSR), spending Rs. 131 crore forty-six lakh in FY 2024-25, slightly exceeding its obligation of Rs. 131 crore forty-four lakh. These funds supported initiatives like advancing basic sciences education through the Chennai Mathematical Institute.
• Prioritizing employee well-being and skill development, being ranked among the top 50 companies in the ‘Great Place to Work’ list for employee health and wellness. The workforce expanded significantly, with a net increase of 5,227 employees, bringing the total to 79,872 individuals by March 31, 2025.

Market Recognition and Future Aspirations

Shriram Finance’s exceptional year was also marked by significant market recognition, including securing a position in the prestigious Nifty50 index. The company’s market capitalization stood at Rs. 1 lakh twenty-three thousand four hundred crore as of March 31, 2025. These achievements reflect the market’s confidence in its resilience and growth strategy.

Looking ahead, the company’s Managing Director & CEO, Yalamati Srinivasa Chakravarti, expressed optimism, stating that Shriram Finance is on track to approach Rs. 3 lakh crore in Assets under Management during FY 2025-26. He anticipates credit growth to align closely with India’s projected GDP growth of 6.5% for FY 2025-26, as historically, loan growth tends to be more than double that of GDP growth. This forward-looking vision, coupled with strategic investments in EV financing and digital infrastructure, positions Shriram Finance for continued leadership and meaningful impact in India’s financial sector.

Compliance and Regulatory Landscape

The company also maintained high standards of compliance throughout the fiscal year. While there were a few instances of minor penalties, such as an RBI penalty of Rs. 5 lakh eighty thousand for non-compliance of certain directions based on a March 31, 2023 inspection, and smaller fines for delayed disclosures (Rs. twenty-one thousand six hundred and Rs. two thousand three hundred sixty), the company promptly addressed these. The overall compliance with RBI guidelines, including those under the Scale-Based Regulation, remains robust. Furthermore, the company has plans to acquire Shriram Overseas Investments Private Limited (SOIPL) to venture into the Primary Dealership business, having received RBI approval post-FY 2025 on April 1, 2025. This expansion will provide access to the fixed income market with guaranteed sources of funds, further diversifying its business.

You Learn

The FY 2024-25 Annual Report of Shriram Finance Limited unequivocally demonstrates a year of exceptional financial performance, strategic acumen, and a deepening commitment to its stakeholders. From achieving record net profits and expanding its AUM to optimizing its portfolio, investing in sustainable finance, and nurturing its human capital, SFL has proven its mettle in a dynamic economic environment. As India continues its growth trajectory, Shriram Finance, with its clear vision and resilient operational framework, is poised to remain a vital enabler of financial inclusion and a powerhouse in the nation’s financial sector, truly embodying its ethos of “Trust that Delivers Growth that Endures”. The company’s journey reflects not just financial success, but a profound dedication to empowering millions and contributing to the economic prosperity of the country.

(India CSR)