Nomura has reaffirmed its positive stance on Shriram Finance by maintaining its Buy rating while simultaneously raising the target price to ₹1,140. This upward revision reflects the brokerage's optimistic outlook on the financial services company's performance and growth prospects.

Brokerage Recommendation Details

The research house's decision to increase the target price demonstrates confidence in Shriram Finance's business fundamentals and market position. The Buy rating continuation suggests that Nomura views the stock as an attractive investment opportunity at current levels.

Market Implications

The target price revision by Nomura adds to the positive sentiment surrounding Shriram Finance in the financial services sector. Such recommendations from established research houses often influence investor sentiment and can impact trading patterns in the stock.

The brokerage's maintained Buy rating, coupled with the enhanced target price, indicates that Nomura expects the stock to deliver returns from its current trading levels. This assessment forms part of the broader analyst coverage that helps investors make informed decisions about their portfolio allocations in the financial services space.

Shriram Finance has received positive rating actions from both ICRA Limited and CRISIL Ratings Limited following board approval for a major fundraising transaction with MUFG Bank Ltd. The company announced preferential issue of equity shares worth ₹39,617.98 crores, prompting both rating agencies to place their ratings on Watch with Positive Implications.

ICRA Rating Action

ICRA Limited has placed Shriram Finance's credit ratings on Watch with Positive Implications following the board's approval of the MUFG Bank investment. The rating action affects both the Fixed Deposit Programme and Non-Convertible Debenture Programme.

CRISIL Rating Update

CRISIL Ratings Limited has placed its rating on the long-term bank facilities and debt instruments on 'Rating Watch with Positive Implications' and reaffirmed its 'Crisil A1+' rating on short-term facilities. The rating action covers extensive debt instruments and facilities.

Transaction Structure and Financial Impact

The preferential issue involves the allotment of 471.12 million fully paid-up equity shares of face value ₹2.00 each to MUFG Bank Ltd. The transaction will result in MUFG holding a 20% stake in Shriram Finance post-equity infusion.

Company Financial Position

As of September 30, 2025, Shriram Finance maintained strong financial metrics with assets under management of ₹2,81,309 crores. Both rating agencies noted the company's comfortable capitalisation and healthy earnings profile.

Conference Call and Regulatory Approvals

Shriram Finance will hold a conference call on December 30, 2025, at 8:00 AM IST to discuss the proposed preferential issue. The transaction is subject to multiple approvals including shareholder consent through special resolution at the EGM scheduled for January 14, 2026, along with clearances from RBI, Competition Commission, and stock exchanges.

Both ICRA and CRISIL stated that their rating watches will be resolved upon conclusion of the MUFG transaction, with completion expected to positively impact the ratings. The agencies highlighted that the proposed equity infusion will significantly strengthen the company's capitalisation profile and support growth plans over the medium term.