Shriram Finance jumps 5% as MUFG set to acquire 20% stake in ₹39.6k-cr deal

Shares of Shriram Finance Ltd. reversed early losses to rise nearly 5 per cent on Friday its board gave a green light to Japan’s Mitsubishi UFJ Financial Group's (MUFG) acquisition of a 20 per cent stake. 

 

The non-banking financial company's (NBFC) stock rose as much as 4.7 per cent during the day to ₹910.8 per share, the biggest intraday rise since November 3 this year. The stock pared gains to trade 4.3 per cent higher at ₹909 apiece, compared to a 0.50 per cent advance in Nifty 50 as of 1:10 PM. 

 

Shares of the company rose for the third straight session on Friday. The counter has risen 55 per cent this year, compared to a 9.4 per cent advance in the benchmark Nifty 50. Shriram Finance has a total market capitalisation of ₹1.68 trillion.   FOLLOW STOCK MARKET UPDATES TODAY LIVE

MUFG to invest ₹39,618 crore in Shriram Finance 

Shriram Finance said its board has approved entering into definitive agreements with MUFG Bank Ltd for an investment of ₹39,618 crore, or about $4.4 billion, through a preferential issue of equity shares. 

 

Following the transaction, MUFG Bank will acquire a 20 per cent stake in Shriram Finance on a fully diluted basis, the company said after a board meeting held on Friday. The lender will sell shares at ₹840.93 per share to MUFG. 

 

Following this, the Shriram Group will continue to be the largest shareholder and promoter of India's second-largest private sector NBFC.

 

Shriram Finance said the transaction is a major milestone for the Indian financial services industry and represents the largest foreign direct investment in an Indian financial services company to date. The investment also reflects strong confidence in the fundamentals and growth potential of India’s lending and financial services sector, it added.  ALSO READ | Elara Securities sees up to 60% upside in BEML stock price; here's why 

The company said the capital infusion will enhance the NBFC's capital adequacy, strengthen its balance sheet, and provide longterm growth capital. "This collaboration is further expected to unlock synergies in technology, innovation, and customer engagement, driving sustainable growth."

 

The deal will improve access to low-cost liabilities and potentially strengthen SFL’s credit ratings while aligning governance and operational practices with global best standards, according to the statement.

 

"The entry of MUFG as a key investor reinforces global confidence in India’s financial services sector and our role as a leader within it," Umesh Revankar, executive vice chairman of Shriram Finance, said in the statement. "Together, we aim to strengthen our capabilities, drive economic progress, and create meaningful impact across communities, building a future-ready institution anchored in trust and good governance."

 

Shriram Finance is one of India’s biggest retail non-banking financial entities, offering credit solutions for commercial vehicles, cars, scooters and personal loans. Its assets under management stood at ₹2.8 trillion as of September 2025.