Shriram Finance Stays Bullish on Commercial Vehicle Growth Amidst Price Hikes; EV Financing Gains Momentum

MUMBAI: Despite rising commodity costs leading to price hikes across the automotive sector, Shriram Finance (SFL), India’s largest financier of commercial vehicles (CV), remains confident in the continued resilience of the market. According to the company’s leadership, the underlying economic activity in India remains robust enough to absorb these price adjustments without stifling demand.

Umesh Revankar, Executive Vice-Chairman of Shriram Finance, told The Times of India that the domestic economy has demonstrated remarkable stability even while navigating global headwinds, such as shifting US tariff policies and geopolitical tensions in West Asia.

“The demand for commercial vehicles is fundamentally tied to economic activity,” Revankar noted, adding that the trend of firming vehicle prices could actually serve as a boon for current owners. As the replacement value of vehicles rises, so too do freight rates, which helps maintain the profitability of fleet operators. For the lender, these higher price points increase the value of each individual loan, effectively supporting the expansion of the company’s overall loan book.

A Surge in Green Mobility

While traditional fuel vehicles remain a core component of the business, Shriram Finance is aggressively expanding its footprint in the green energy space. The company reported a five-fold jump in electric vehicle (EV) financing, with monthly disbursements climbing to Rs 250 crore this year, up from just Rs 50 crore in the previous year.

The momentum is expected to accelerate further, with the firm projecting monthly EV disbursements to double to Rs 500 crore by next year. This growth spans the entire spectrum, from two-wheelers and three-wheelers to passenger four-wheelers, with an increasingly steady transition toward electrification in the commercial vehicle segment.

Strategic Expansion and Global Backing

The company’s growth outlook is bolstered by a massive influx of capital. Following the decision by Japan’s MUFG to acquire a 20% stake in SFL for approximately Rs 40,000 crore via a preferential issue, Shriram Finance has secured a robust capital buffer that is expected to last until 2030.

Beyond capital, the partnership with MUFG is set to open new doors. SFL plans to leverage the collaboration to connect with Japanese companies operating in India that require financial services.

To support its ambitious goal of doubling its assets within five years—and achieving 18–20% growth by FY27—SFL is scaling up its physical infrastructure. The firm intends to open roughly 150 new branches and increase its workforce by 2,000 to 3,000 employees this financial year.

As the market continues to evolve, Shriram Finance’s blend of deep-rooted branch networks and strategic international partnerships positions it to capitalize on the sustained commercial vehicle demand and the inevitable shift toward electric mobility.