Will limit debt restructuring to a select few: Shriram Transport CEO

Breathing easy amid gradual revival in business, Shriram Transport Finance has decided to extend the loan restructuring option to select customers. Chief Executive Umesh Revankar tells T E Narasimhan in an interview that the company does not see any challenge to its cash flows. Edited excerpts:

The RBI has announced a restructuring scheme for loans. So what happens to customers impacted due to the pandemic? 

Restructuring is a measure we can decide whom to extend to, and whom not to. Customising according to individual customers’ requirements is possible. Even the moratorium was supposed to be extended to all customers who were broadly eligible. It was, then, up to the customer to take it or leave it.

You don’t see any mismatch in cash flows for Shriram?

I do not see any challenge in management of the cash flows. There is no challenge for Shriram as we will anyway be limiting it to a select few. Further, as economic activity has already picked up, there is no question of deferring EMIs any more.

How are customers responding to this?

Given that the lockdown has been lifted and business is improving, I don’t think there would be any demand for restructuring of deferment of instalments, from the customers’ side.

How was demand like, during the lockdown?

There were lockdowns in Tamil Nadu, Uttar Pradesh, Maharashtra. With these now lifted, shops are open from 9am to 7pm and hence people are free to go and buy anything. There is no supply chain problem at any location. Vehicles have been plying. There is no reason to see any challenge.

What has hit demand during this period?

Demand has been quite robust but we have lost three months’ worth business as regional transport offices were closed and not because of any absence in demand. Since RTOs were closed, buying and selling transactions came to a halt. Otherwise, we would have lent more.

How has it impacted AUM, and what kind of growth are you targeting?

If we are able to maintain our AUM level, it would be a positive in the present environment. Growth in AUM will remain little changed for some time.