Shriram Equipment Finance Moving with Alacrity

Shriram Equipment Finance
"We have decided to enter into the smaller end because there are already a handful of financers at the top side but that does not mean that our focus is solely at the smaller customer, but cater to entire spectrum and almost 20% of customers are mid and large size on our portfolio. Today, we are the largest financer for atleast 7 out of top 15 manufacturers in the country where our equipment range comprises excavators, loaders, tippers, backhoe loaders besides other infrastructural equipment," quips Mr. Pratap Paode, Chief Executive Officer of Shriram Equipment Finance Company Limited, in an interview with S.D.Khan.

How do you see the Indian Construction Equipment Market growing in the coming years and how does this correlate with the fortunes of CE financers?
The country has witnessed an infrastructural boom for quite some time and the trajectory will surely move upwards in the years to come. Even if a fraction of the proposed expenditure on infrastructure is incurred, it will result in a considerable upsurge in infrastructural activities across the country. It's a well-known fact that whopping investments are slated for ports, dams, roads, bridges, power plants, and so on. Once these projects are materialised, financing will definitely play a major role. Nonetheless, we need a structured government policy to ensure that things move in the right direction. Political whirlwinds have deterred infrastructural growth time and again. The next 4 to 6 months are quite testing and way the things as they appear today, customers will have difficulty in gainful deployment of assets and also realization payments in timely manner. However, these problems can be contended with if the government is actively involved and commitments to infrastructure spend and growth are kept. This is critical from industry and country's perspective.

What is the size of the CE finance industry in India and what is the share of Shriram Equipment Finance Company?
According to our estimates, the market size is around Rs.30,000 crores, of which, Rs.10,000 crores is the share of used equipment refinancing. So, if one considers only the new equipment market, which is of Rs.20,000 crores, then our share is 10%. However, if the used equipment market is also taken into account, our share would be around 8 percent.

Being a recent entrant in the market; what has been Shriram's strategy and how has the company progressed over the course of one year?
As a new entrant, we decided to enter into relatively vacant space i.e. small and medium customer segment providing wide distribution network. Currently we operate out of 112 locations which none other financier in the country has. While we take larger risk on customers and assets in order to keep up with our promise to provide geographic, asset and customer grade inclusion to the industry, it is necessary to have wider distribution. This proximity to customers enables us to service them better and faster and also aids effective collection which is key to our profitability. We have successfully scaled our business in this chosen segment and in less than a year, emerge as one of the largest retail Construction Equipment financier in the country.

What is the USP of Shriram and how does the company cater to its customers?
Well, we take larger risks than any other financer and the probability of rejection of any deal is almost negligible. The customers are provided with the option of 2, 3, 4 and 5 years loans depending upon their financial conditions and repayment capabilities and can exercise option of repayment in any of the 550 branches of Shriram Group. We are almost at top with most manufacturers as preferred/favored financier as we do not differentiate on assets on their level and provide fasted deal TAT.

Are there any risks involved with equipment financing and how should a financer tackle them?
Timely collection of dues is certainly a big problem and companies not having wide collection network may have to restrict themselves to select large customers but that obviously would yeild extremely thin margins and key financial parameters viz. ROTA, ROE will be low. It's therefore imperative that a finance company's distribution system should be intact and vastly spread. The focus should be on the bottom line to ensure a long-term existence. Moreover, India's tax system is quite cumbersome and the price of an asset varies from state to state. The onus is on the government to devise multi-pronged policies in order to smoothen the process and bring uniformity. Nevertheless, NBFC is a better option as compared to a bank since customers are serviced faster and taken better care of. This is primarily on account that NBFCs take CE financing as an industry vertical and have better risk assessment ability and distribution ability to areas and customers that are under-banked.

Shriram Equipment Finance

A word about Excon 2011 and how has it come up to your expectations?
The show has grown by leaps and bounds over the years and it's a perfect barometer of the growth of the Indian CE industry. Although there are looming fears of recession in short term, but the manner in which Excon 2011 has unfolded, the future on long term assessment holds good for both the manufacturers and the customers. Shriram has witnessed an encouraging response and prospects look very bright.
NBMCW January 2012
NBM&CW Celebrates 30 Years of Progress in the Construction Industry

NBM&CW Celebrates 30 Years of Progress in the Construction Industry

This month marks a significant milestone for our publication as we celebrate 30 years of dedicated service to the construction industry. For over three decades we have been relentless advocates for the adoption of technology, equipment

Read more ...

The Future of Indian Infrastructure Construction Landscape

The Future of Indian Infrastructure Construction Landscape

The Indian construction industry is poised for a significant transformation over the next two decades. With a strong focus on infrastructure development, India will invest over 1.40 trillion USD in the next five years on infra

Read more ...

KNR Constructions: Optimizing Project Delivery with Advanced Equipment

KNR Constructions: Optimizing Project Delivery with Advanced Equipment

Mechanization is helping projects become more financially viable. At KNR, we have become self-reliant by deploying our own equipment and new construction methodologies, which is also helping us optimize cost and time during

Read more ...

Volvo CE: Electric Excavators, Wheel Loaders, Haulers & Compactors

Volvo CE: Electric Excavators, Wheel Loaders, Haulers & Compactors

Volvo CE India is a frontrunner in sustainable construction equipment, offering electric excavators, wheel loaders, haulers, and compactors alongside advanced technologies for efficiency and flexible business models to meet evolving customer needs.

Read more ...

Rajpath Infracon: Transformative Technologies Driving Growth Opportunities

Rajpath Infracon: Transformative Technologies Driving Growth Opportunities

Rajpath Infracon recognizes that innovation is the key to building sustainable, efficient, and durable roads for the future. They advocate for the adoption of advanced technologies throughout the entire project lifecycle - from materials and design to construction and maintenance.

Read more ...

AFCONS: Leveraging Technologies Like GFRP, HSFRC, UHPC, Precast & BIM

AFCONS: Leveraging Technologies Like GFRP, HSFRC, UHPC, Precast & BIM

AFCONS Infrastructure is at the forefront of construction innovation, leveraging disruptive technologies like GFRP, HSFRC, UHPC, precast construction, and BIM to address labor shortages, enhance sustainability, and improve project efficiency.

Read more ...

Wirtgen: Cold Milling Machines, Asphalt Pavers & Compaction Equipment

Wirtgen: Cold Milling Machines, Asphalt Pavers & Compaction Equipment

With its innovative and cost-effective road building and rehabilitation machines, the Wirtgen Group has emerged as an undisputed market leader, offering customers tech-rich and value-for-money products.

Read more ...

Godrej Switches to 100% Green Energy; Builds 3D Printed Office from RCA

Godrej Switches to 100% Green Energy; Builds 3D Printed Office from RCA

We have implemented eco-friendly production processes and energy-efficient technologies to minimize our carbon footprint; we also adhere to stringent waste management protocols, and the principles of Circular Economy.

Read more ...

Terex: Cutting-Edge Mobile Crushers & Screens, Washing Systems & Cranes

Terex: Cutting-Edge Mobile Crushers & Screens, Washing Systems & Cranes

Terex India, a leader in materials processing equipment like Powerscreen® mobile crushers and Finlay® screens, is at the forefront of sustainable construction. Their Hosur facility exemplifies operational excellence with a focus on clean energy, environmental responsibility, and digital tools for efficiency across their diverse product range including Terex® Washing Systems, Franna® cranes, and EvoQuip® solutions.

Read more ...

BMC Mumbai: Road Repair with Thin White Topping & Ultra-Thin White Topping

BMC Mumbai: Road Repair with Thin White Topping & Ultra-Thin White Topping

Thin White Topping/Ultra-Thin White Topping overlays are innovative pavement repair and strengthening solutions and are also cost-effective and less maintenance intensive, having demonstrated performance comparable to traditional

Read more ...

ACE: Mobile Crane, Pick & Carry Crane & Backhoe for Next-Gen Construction

ACE: Mobile Crane, Pick & Carry Crane & Backhoe for Next-Gen Construction

Action Construction Equipment (ACE) offers a comprehensive range of construction equipment – mobile cranes, Pick & Carry Cranes, fixed tower cranes, backhoe loaders, and more – while pioneering sustainable solutions and advanced technologies like automation and AI for next-generation construction.

Read more ...

Sanghvi Movers: Leading Crane Rental Industry With End-to-End Solutions

Sanghvi Movers: Leading Crane Rental Industry With End-to-End Solutions

Sanghvi Movers, Asia's largest crane rental company, leverages its extensive fleet of cranes and expertise to address infrastructure growth in India. They offer comprehensive solutions including logistics, erection services, and project management for diverse sectors like wind energy and refineries.

Read more ...

JCB LiveLink & Industry 4.0 for Connected Machines & Smart Manufacturing

JCB LiveLink & Industry 4.0 for Connected Machines & Smart Manufacturing

JCB India leads the way in digital construction with JCB LiveLink for their iconic Backhoe Loaders and other machines, offering real-time data, improved efficiency, and Industry 4.0 adoption for smarter manufacturing.

Read more ...

Adani Group: Driving Construction Innovation with Digital Solutions & AI

Adani Group: Driving Construction Innovation with Digital Solutions & AI

Ambuja Cements and ACC’s focus on Digitalisation and AI-driven strategies are delivering exceptional solutions. By embracing cutting-edge technologies and fostering a culture of innovation, we are offering best-in-class products and

Read more ...

SCHWING Stetter: Batching Plants, Concrete Pumps & Waste Recycling Plants

SCHWING Stetter: Batching Plants, Concrete Pumps & Waste Recycling Plants

SCHWING Stetter India, a leader in concrete equipment, offers a wide range of innovative products – batching plants, concrete pumps, mixers and waste recycling plants – to promote sustainable and efficient construction practices.

Read more ...

Kalpataru Group: Transforming the EPC Industry for a Greener Future

Kalpataru Group: Transforming the EPC Industry for a Greener Future

Kalpataru Group champions sustainable practices in the EPC industry, focusing on renewable energy, green buildings, and innovative technologies for a greener future.

Read more ...

Puzzolana: Leveraging R&D for Advanced Crushing & Screening Equipment

Puzzolana: Leveraging R&D for Advanced Crushing & Screening Equipment

Puzzolana leverages R&D to develop cutting-edge crushing and screening equipment, including high-capacity jaw and cone crushers, for optimized production and reduced costs per ton.

Read more ...

SGES Group: Expert Geotechnical Solutions for Streamlined Construction

SGES Group: Expert Geotechnical Solutions for Streamlined Construction

At SGES, our team brings over 200 years of collective experience in solving complex geotechnical problems; by quickly providing tailored solutions, we assist clients in making timely decisions, thus avoiding time and cost overruns.

Read more ...

Sany: Intelligent Service Platform with Telematics & Electric Dump Truck

Sany: Intelligent Service Platform with Telematics & Electric Dump Truck

Sany India discusses their Intelligent Service Platform with telematics and analytics, commitment to electric vehicles like the SKT105E mining dump truck, and plans for hybrid construction equipment.

Read more ...

To get latest updates on whatsapp, Save +91 93545 87773 and send us a 'Saved' message
Click Here to Subscribe to Our eNewsletter.