Shriram Finance Approves MUFG Bank Equity Investment

The Board of Directors of Shriram Finance Limited (“SFL”) at their meeting held today approved entering into definitive agreements with MUFG Bank Ltd. (“MUFG  Bank”) for an investment of INR 39,618 crore (~ USD 4.4 billion) in SFL through a preferential  issuance of equity shares. This investment will result in MUFG Bank acquiring a 20.0 % stake on a fully diluted basis.[1] 

This landmark transaction underscores SFL’s status as India’s second largest retail Non-Banking  Financial Company (NBFC) [2] in terms of assets under management and represents a significant  milestone for the Indian financial services industry on account of : 

• Being the largest FDI in a financial services company in India 

• Reinforcing confidence in India’s lending and financial services sector fundamentals and future  growth potential 

• Strengthening SFL’s capital base and accelerating its growth trajectory 

The proposed minority investment by MUFG Bank is subject to shareholder approval, regulatory  clearances and customary closing conditions. 

This collaboration combines SFL’s established domestic franchise and extensive distribution network  with MUFG Banks’s global expertise and financial strength. The fund infusion will significantly enhance SFL’s capital adequacy,strengthen its balance sheet, and provide long-term growth capital. This collaboration is further expected to unlock synergies in technology, innovation, and customer  

engagement, driving sustainable growth. It will improve access to low-cost liabilities and potentially  strengthen SFL’s credit ratings while aligning governance and operational practices with global best  standards. 

This investment reflects MUFG Bank’s confidence in India’s dynamic financial services sector.  Mitsubishi UFJ Financial Group (MUFG), MUFG Bank’s parent entity, has a legacy of over 130 years in  India, contributing USD 1.7 billion in investments and creating jobs approximately 5,000 people. The investment in SFL will be MUFG’s largest investment in India, reinforcing its commitment to financial  inclusion and sustainable growth. 

Umesh Revankar, Executive Vice Chairman, Shriram Finance Limited, said: "This transaction marks a defining moment in our growth journey. MUFG is one of the largest financial  institution, with an extensive international network and strong values rooted in substantial growth  and financial inclusion. 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. 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.”

Hironori Kamezawa, Group Chief Executive Officer, Mitsubishi UFJ Financial Group stated, “MUFG is proud to enter into this transaction and become a strategic partner of Shriram Finance,  one of India’s most respected financial institutions. MUFG and Shriram Finance share a common  vision and aligned values for the future. Leveraging our global capabilities, MUFG is committed to  supporting Shriram Finance’s growth and contributing to economic development, communities, and  society in India.”