Shriram Transport Finance Company fell 2.08% to Rs 1078 after Standard & Poor Global Ratings revised its outlook on the company to negative from stable on weaker economic conditions.
Standard & Poor Global Ratings on Monday, 16 December 2019, said that it has revised its outlook on Shriram Transport Finance Company (STFC) to negative from stable on concerns of asset quality deterioration and pressure on profitability. However, the rating agency maintained the company's rating at BB+ long term and B short term rating.Slower economic growth and weaker economic activity could lower vehicle utilization, affecting the cash flows of road transport operators, it said. S&P expects growth and profitability to remain under pressure for STFC, given market funding conditions continue to be tight.
Meanwhile, Fitch Ratings has affirmed STFC's long-term issuer default rating (IDR) at 'BB+'. The outlook is stable.
On consolidated basis, STFC's net profit soared 25.4% to Rs 768.29 crore on 6.9% rise in total income to Rs 4,219.82 crore in Q2 September 2019 over Q2 September 2018.
STFC is an asset financing non-banking finance company. The firm is engaged in providing finance for commercial vehicles and other loans. The company operates through financing segment. It operates through a network of approximately 850 branches.
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