Money & Banking

Sundaram Finance to tread cautiously, to expand in newer territories

Our Bureau | Updated on July 19, 2019 Published on July 19, 2019

S Viji, Chairman

Hopes govt’s thrust on infrastructure will improve the prospects

Sundaram Finance has indicated that it will tread a cautious path this fiscal due to the challenging outlook, but will penetrate deeper in some of the geographies it entered in recent years.

“Uncertainties surrounding market liquidity, interest rates, global oil prices and the imminent introduction of BS-VI emission norms rendered forecasts difficult. The government’s continuing thrust on infrastructure should hopefully provide some impetus to the construction equipment and related segments,” S Viji, Chairman of Sundaram Finance, said at the company’s 66th AGM.

He also said that progress of the South-West monsoon will be crucial given its impact on the overall prosperity and well-being of rural India, which, in turn, will influence consumption spending.

Newer markets

Viji said Sundaram Finance will focus on its core markets and segments, while simultaneously exploring opportunities in newer geographies.

Echoing his views, TT Srinivasaraghavan, Managing Director of the company, said: “Our growth this year will be cautious, without compromising quality. In recent years, we have ventured into new States and geographies and are now deepening our presence in some of them and expanding in a few others.”

“In this business, it is very easy and sometimes tempting to grow at a rapid pace. Over the years, Sundaram Finance has grown on the basis of prudence,” he added.

Budget proposals & NBFCs

The management welcomed the regulatory proposal in the Budget to bring tax parity with banks. Viji said the Finance Minister’s acknowledgement of the role of NBFCs in the country’s economic growth was indeed reassuring.

He said the Budget proposals supporting the NBFC sector was a good confidence-restoring move.

He also pointed out that several other proposals such as the one on the capital markets front and the regulatory and taxation fronts were noteworthy.

“The proposal to permit transfer or sale of investments made by FIIs/FPIs in debt securities issued by infrastructure debt fund — non-bank finance companies to domestic investors and allow AA rated bonds as collateral, should hopefully, kick off the long talked about deepening of bond markets.”

Published on July 19, 2019
This article is closed for comments.
Please Email the Editor