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W16533

SHRIRAM TRANSPORT FINANCE1

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Gennaro Bernile, Anand Shankar, and Rahul Rajani wrote this case solely to provide material for class discussion. The authors do
not intend to illustrate either effective or ineffective handling of a managerial situation. The authors may have disguised certain
names and other identifying information to protect confidentiality.

This publication may not be transmitted, photocopied, digitized, or otherwise reproduced in any form or by any means without the

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permission of the copyright holder. Reproduction of this material is not covered under authorization by any reproduction rights
organization. To order copies or request permission to reproduce materials, contact Ivey Publishing, Ivey Business School, Western
University, London, Ontario, Canada, N6G 0N1; (t) 519.661.3208; (e) cases@ivey.ca; www.iveycases.com.

Copyright © 2016, Richard Ivey School of Business Foundation Version: 2016-08-26

I do understand that many of you may have a difficult time in doing business in India.
op
Arvind Mayaram, India’s economic affairs secretary, addressing representatives from the
U.S.-India Business Council in Washington, D.C., 2013

In December 2012, the stock of Shriram Transport Finance Company (STFC) had just breached the ₹750
mark,2 signifying an appreciation of close to 80 per cent for the calendar year of 2012. Texas Pacific
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Group (TPG), the global private equity (PE) firm, had invested in STFC at a time when the share price
was hovering around ₹100. As was the case with most private equity firms, a successful exit from an
investment was of paramount importance for TPG in order to reap handsome returns.

The past week had been a harrowing experience, with revised official estimates placing Indian economic
growth at just 5.8 per cent.3 Earlier in June 2012, the World Bank had cautioned that growth in India was
weak, owing to a multitude of factors ranging from stalled reforms to electricity shortages. These factors,
coupled with fiscal and inflationary trends, adversely affected investment activity.4 A Statista.com report
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traced the steep decline in real gross domestic product (GDP) rates in India from 10.26 per cent in 2010 to
5.08 per cent in 2012.5 The International Monetary Fund followed suit with a bleak assessment in October
2012, but the executive management at the Reserve Bank of India (RBI) remained unconvinced about
slashing interest rates. Despite its long history in North America and its worldwide reach, TPG was a new
player in the nascent Indian PE industry and would have to avoid pitfalls, such as selling at the wrong
time or at low exit valuations, that could erode its fund’s performance in the promising Indian market.
Do

1
This case has been written on the basis of published sources only. Consequently, the interpretation and perspectives
presented in this case are not necessarily those of Shriram Transport Finance Company or any of its employees.
2
₹ = INR = Indian rupee; all currency amounts are in ₹ unless otherwise specified; US$1 = ₹54.26 on December 1, 2012.
3
Mark Thompson, “India's Economy Grows at Slowest Rate in Decade,” CNN Money, December 17, 2012, accessed April
12, 2015, http://money.cnn.com/2012/12/17/news/economy/india-economy.
4
“World Bank Marginally Raises India’s Growth Forecast to 6.9% for 2012,” Economic Times, June 13, 2012, accessed April 5,
2015, http://articles.economictimes.indiatimes.com/2012-06-13/news/32215710_1_growth-forecast-hans-timmer-gdp-growth.
5
“India: Real Gross Domestic Product (GDP) Growth Rate from 2010 to 2020 (Compared to the Previous Year),”
Statista.com, accessed April 15, 2015, www.statista.com/statistics/263617/gross-domestic-product-gdp-growth-rate-in-india.

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In the course of charting the exit path from an investment, PE firms had to consider several critical issues
including exit structure, timeline for exit, and regulatory hurdles. There were three usual choices of exit
routes: initial public offering (IPO), trade sale, or secondary sale.

Over the previous eight years, the market capitalization of the financial business of the overall company,
Shriram Group (Shriram), increased almost 50 times. The earnings per share in Shriram’s transport

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company, STFC, had also increased significantly from ₹11.01 in financial year (FY) 2006/07 to ₹54.49 in
FY2010/11.6

Given this propitious timing, the TPG team had to act fast; failure was not an option. Each of the exit
routes had its own advantages and disadvantages. Was this the right time for TPG to exit STFC? If yes,
which option should TPG pursue?

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GLOBAL PRIVATE EQUITY SNAPSHOT AND THE INDIAN PRIVATE EQUITY SCENE IN 2012

Since its origins in the United States in the late 1940s, PE had assumed increasing significance as a source
of capital, along with the closely related activity of venture capital. PE entailed financial sponsors who
took a business private and deployed restructuring strategies, with the ultimate goal of shepherding the
investment to a successful exit. In 2012, global private equity investment activity remained flat,
continuing the trend exhibited in 2011. The sovereign credit crises in European nations and the “fiscal
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cliff” debacle in America, where opposition politicians sparred with President Obama over taxes, were
worrying global PE fund managers.

Back in India, the PE industry revealed signs of fracture due to widespread macro issues plaguing India in
2012. The spectre of retrospective taxation on investments by overseas investors, and the lack of a clear
policy stance, proved tough for general partners at PE firms to navigate. At that time, 55 funds had a
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mandate to invest in India. Yet, only around US$3 billion7 total fund value had been allocated—a drop of
about $4 billion from 2011. Despite the growing number of deals, from 531 deals in 2011 to 551 deals in
2012, PE investors in India had increasingly moved toward ever smaller deals (see Exhibit 1). PE fund
managers investing in India hoped for a moderately positive 2013. As one of the global PE powerhouses,
TPG was optimistic on India in the long term and was keen to ride the wave of India’s growth.
No

Texas Pacific Group

TPG was one of the biggest PE firms in the world, with assets under management of more than $50
billion. Founded in 1992, TPG grew by deploying its contrarian focus to invest in companies facing
financial issues. TPG and its illustrious founder, David Bonderman, quickly became famous with the
1992 acquisition of Continental Airlines in the United States. TPG was also one of the earliest PE firms to
invest in Asia and Latin America through its subsidiary unit TPG Newbridge. Since its formation, TPG
Newbridge developed proficiency in five broad industry clusters: financial services, technology and
telecom, health care, consumer, and industrials.
Do

Known for its expertise and focus on leveraged buyouts, TPG was well aware of the presence of family
businesses in the Indian business landscape. TPG entered the Indian market in 2004, having thoughtfully

6
T. E. Narasimhan, “Why Private Equity Loves Shriram Group,” Business Standard, January 31, 2012, accessed April 15,
2015, www.business-standard.com/article/companies/why-private-equity-loves-the-shriram-group-112013100007_1.htm.
7
All dollar amounts are in US$ unless otherwise stated.

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crafted out a strategy of fostering partnerships and promoting itself as a “value enhancer,” instead of the
much-maligned “corporate raiders.” TPG’s India foray started with an investment in Matrix Laboratories
Limited in 2004, which TPG subsequently exited in 2006 with a handsome return worth double the
original investment. TPG was keen to leverage its expertise in financial sector investing and was on the
hunt for a suitable financial services provider that was ripe for rapid scaling-up. TPG had been through
some challenging times with its financial sector investments across Korea, China, and Indonesia, but

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India was an altogether different market. In mid-2005, non-banking finance companies (NBFCs) caught
the TPG team’s attention, and thus began one of the greatest investments in Indian PE history up until that
time.

Evolution of Non-banking and Transport Finance in India (2006–2012)

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India’s financial sector was bank-dominated, with commercial banks accounting for over 60 per cent of
the total assets of the financial system. NBFCs operated in specialized segments, and some accepted
deposits. An NBFC was defined as follows:

A company registered under the Companies Act of 1956 and engaged in the business of loans and
advances, acquisition of shares/stocks/bonds/debentures/securities issued by Government or local
authority or other marketable securities of a like nature, leasing, hire-purchase, insurance
business, and chit business.8
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The NBFC sector in India had come a long way since the days of heady and unregulated growth in the
mid-1990s.9 As the share of NBFCs’ assets in GDP increased steadily from 8.4 per cent in March 2006 to
11.9 per cent in 2012, the RBI was forced to act by introducing more stringent regulations, as
recommended by the eminent Usha Thorat committee.10
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Transport finance companies had long been a cog in the economic growth engine of India, where 65 per
cent of freight was carried via national highways. According to 2013 projections, the total road length in
India was over 3.34 million kilometres, making the Indian road network the second largest in the world,
after the United States.11 Although commercial vehicle sales in India had increased 18.2 per cent year-on-
year in FY2011/12, the sales of medium and heavy commercial vehicles had increased only by 8.1 per
cent (see Exhibit 2).
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Furthermore, the mining ban across several Indian states in 2012 was biting into the revenues of
commercial transport companies. Slowing industrial growth and a tough operating environment led to
stagnation of freight rates, causing fleet operators to shelf expansion plans.12 As the TPG dealmakers sat
down to study the Indian NBFC sector, they grew enamoured by Shriram—the market leader, with close
to four decades of stellar performance and millions of loyal customers.
Do

8
Brij Mohan, “Non-banking Financial Companies in India: Types, Needs, Challenges, and Importance in Financial Inclusion,”
International Journal of Multidisciplinary and Academic Research 3, no. 6 (December 2014): 2.
9
Lok Sabha Secretariat, “Financial Sector in India: Regulations and Reforms,” Reference Note No. 15/RN/Ref./August/2013,
accessed April 15, 2015, http://164.100.47.134/intranet/financialsectorinindia.pdf.
10
Brij Mohan, op. cit.
11
Indian Roads Congress, Indian Highways: A Review of Road and Road Transport Development 41, no. 2 (February 2013).
12
Shriram Transport Finance Company Limited, 33rd Annual Report 2011/12, accessed April 22, 2015,
http://stfc.in/pdf/annual-report/STFCAnnualReport2011-2012_a63eea.pdf.

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SHRIRAM

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Shriram was an iconic South Indian business house founded by Ramamurthy Thyagarajan, AVS Raja,
and T. Jayaraman in 1974. Headquartered in Chennai, capital of the state of Tamil Nadu, Shriram had its
humble beginnings in the chit fund business. Over the years, the company had gradually diversified into
other areas of financial services, establishing a recognized brand name in a range of segments, including

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commercial vehicle financing, stockbroking, distribution of insurance products, and mutual funds.
Shriram had also ventured into non-financial service markets such as property development, engineering
projects, information technology, and a variety of small ventures ranging in everything from musical
instruments to stem cells.

Thyagarajan (fondly known as RT) had overseen the tremendous growth of the conglomerate for nearly
four decades. Armed with a master’s degree in math from the Indian Institute of Statistics, Thyagarajan

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believed that mathematics played a crucial role in developing his business edge. Thyagarajan had come a
long way since his role as a branch manager at New India Assurance Co. Ltd. back in the 1970s. At that
time, Thyagarajan made the gamble of his lifetime by committing approximately $10,000 of his personal
money into Shriram, laying the foundation for his empire, eventually worth over $4 billion. Thyagarajan
believed that trust and focus on math for business decisions were the secret ingredients in the recipe of
Shriram’s excellent growth: “Mathematics can help create certain yardsticks, with which decision making
becomes easier. This isn’t available in B-schools. There, thought is half-baked. Ten years from now, we
will take five to six people from the institute who will be part of our management team.”13
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Given the potential of the business across India and the simplicity of the founder’s strategy, it was not
long before Shriram claimed its crown as the darling of Indian PE investors. As of early 2012, 23 PE
firms had invested over $750 million into various Shriram companies. Thyagarajan put things into
perspective: “We treat all investors, including minority investors, as partners. We believe that all of them
should benefit as much as we shareholders benefit. There is, therefore, a unique convergence of objectives
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leading to a win-win situation all the time.”14

Shriram Transport Finance Company

STFC was Shriram’s flagship company. Established in 1979, STFC had become a behemoth in the Indian
transport finance sector. STFC leveraged the numeracy skills of its staff to drive growth by catering to the
No

very poor of the world, referred to as “the bottom of the pyramid.” This segment was often ignored by
other players. Poor borrowers did not have stable incomes and lacked proper credit histories. However,
this was the void that STFC was looking to fill, and it successfully did so by placing enormous trust on its
borrowers and extending loans to poor customers across India. This focus on trust cemented strong ties
with its clientele and helped forge lifelong customer relationships. STFC followed a hub and spoke
model, with primary focus on vehicles serving very remote areas, known as “first and last mile” delivery.

STFC’s decision to finance the often-spurned small truck owner also created tremendous social benefits.
Individuals who had yearned to enhance their lives, but lacked the means to do so, found a guardian angel
Do

in STFC. The company was successful in bridging the gap between aspiration and ability: “I am always

13
Sanjay Vijayakumar and V. Balasubramanian, “Shriram Group Founder R. Thyagarajan Bets on Math and Mathematicians
for Business Success, Not That Much on B-School Grads,” Economic Times, May 27, 2012, accessed April 14, 2015,
http://articles.economictimes.indiatimes.com/2012-05-27/news/31860985_1_r-thyagarajan-shriram-group-mathematicians.
14
T. E. Narasimhan, op. cit.

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fascinated by people who have failed in entrepreneurship because of lack of money. I support them,
because you need people who don’t look at risk. If everybody focuses on risk, nothing will happen.”15

With Thyagarajan at its helm, STFC hit the IPO trail very early in 1984. Since going public, STFC had
charted its way forward by strengthening customer loyalty and trust every step along the way. By 2012,
STFC had a near monopoly in the transport finance sector with more than 15,000 employees and assets

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under management of approximately $8 billion (see Exhibit 3).16 As of early 2012, Shriram’s total
customer base stood at 3.5 million, and the potential for cross selling products was huge. Shriram also had
the lowest cost of acquiring customers and was highly successful in converting inquiries into actual
sales.17 Over its successful history, STFC had carefully balanced high-risk lending with higher market
penetration, thus generating good yields on new vehicle financing. Having a monopoly in South India,
STFC was gearing up to make a push for a countrywide presence in late 2005, when the TPG team
decided to make its initial contact with Shriram. With demand for its products growing rapidly, Shriram

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found it increasingly difficult to raise funds that could be translated into small, affordable loans. A deal
with TPG could fulfil this need and provide a mature partner to Shriram to help grow the business further.

Investing in Shriram

Shriram’s tryst with overseas investors dated back to the tumultuous period in the late 1990s, when
NBFCs had to fight for their survival. STFC was the only major player that had successfully navigated
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the challenges generated by the government of India and the RBI. The company got its first massive break
in 2002, when Citigroup Banking Corporation (Citi) acquired a 14.9 per cent equity stake in both STFC
and Shriram Group. This investment by Citi proved to be a game changer. Shriram now had the attention
and trust of a big investor. By 2005, STFC had amassed an asset base of $1.15 billion, net profit of $11.5
million, and a market capitalization of $115 million. STFC’s managing director R. Sridhar stated: “The
main [challenge] that we faced was on institutional resource. We were dependent on retail funding, as
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institutions felt that the customers whom we were financing were risky. It took a lot of time for us to
change their mindset.”18

TPG was smitten by Shriram from the beginning and envisaged a partnership that could unlock value for
both groups. Puneet Bhatia, managing director and head of TPG in India, was tasked with convincing
Shriram’s apprehensive founder Thyagarajan. As Bhatia explained, “It took me six months to develop an
equation with [Thyagarajan]. He was hesitant. He felt he had a special platform, one that American
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investors wouldn’t appreciate.”19

TPG’s efforts paid off in June 2006, when STFC agreed to offload a 49 per cent stake from Shriram to
TPG for approximately $100 million. This was TPG’s first foray into the financial services sector in the
country, and the company looked to implement a long-term strategy in collaboration with its new partner.
The deal with STFC was a great accomplishment for TPG. STFC was Shriram’s cash cow, and it had
both a well-established national reach and a loyal customer base. Aptly summing up the relationship
between the two parties, Bhatia was reported saying that “investing is like a marriage; there are so many
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15
Sanjay Vijayakumar and V. Balasubramanian, op. cit.
16
Shriram Transport Finance Company Limited, op. cit.
17
T. E. Narasimhan, op. cit.
18
N. Madhavan, “R. Sridhar on What Makes Shriram Transport Finance Company a Success,” Business Today, January 17, 2012,
accessed April 20, 2015, www.businesstoday.in/opinion/interviews/r-sridhar-sriram-transport-finance-company-interview/story/
21726.html.
19
Deepti Chaudhary, “Playing for Keeps: The Investment Strategy of TPG Capital,” Forbes India, December 9, 2014,
accessed 25 April 2015, http://forbesindia.com/printcontent/39147.

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ups and downs and we can’t anticipate everything. [Thyagarajan and Shriram’s board of directors] are
very enlightened and treat us as partners. We would rather invest in them than seek out new businesses.”20

The Deal

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In early 2005, STFC had struck a deal with the PE firm ChrysCapital for a 17.26 per cent stake in the
company. Fresh off that funding from ChrysCapital, STFC was back at the deal table with TPG.
ChrysCapital’s $20 million investment had helped STFC consolidate its own balance sheet and augment
Shriram’s long-term vision of the overall group of companies. In June 2006, after much courting, TPG
made its first investment in STFC, through STFC’s parent company, Shriram Holdings (Madras) Private
Limited (see Exhibit 4). The parent company remained private, although STFC was already a listed
company on both the Bombay Stock Exchange and the National Stock Exchange.

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Having had great expertise in the financial services industry, TPG helped STFC scale at a much faster rate
by growing STFC’s loan book and establishing more efficient systems. In the past, there was no link
between the Shriram group of companies and the credit rating firms, which resulted in irregular
monitoring. The company decided to take a proactive approach to solve this problem by sending officials
to credit rating firms and research houses to understand the data they needed for effectively tracking
companies in Shriram. This approach resulted in every major research house in the country covering the
group and ultimately garnered pan-India attention.
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The partnership with TPG enhanced the visibility of Shriram and proved to be invaluable in terms of
additional financing. For most of the first 20 years of the company, public deposits constituted its main
source of capital. By early 2012, however, having acquired access to and skilfully deployed PE money for
growth, Shriram had become the largest asset financing, non-banking finance company in India, with
assets of $3.5 million, profits of $240 million, and a market capitalization of $7 billion.
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The Exit Path

PE firms in India usually expect two or three times returns on their money invested. However, given the
current market conditions, nothing was a guarantee. The TPG team had previously made an unsuccessful
attempt to exit STFC through a sale to Orix Corporation, the Japanese financial behemoth. Fortunately for
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TPG, 2012 proved to be a great year for the Indian stock market with 25.7 per cent gains, the best in three
years.21 Yet, the challenges remained, including an over-leveraged banking system and the looming threat
of a sovereign ratings downgrade.

Since its first investment in STFC in 2006, TPG had strengthened its investment in Shriram’s group of
companies and now owned parts of Shriram Capital and Shriram Properties. With tremendous hopes for
the future and a strong relationship with Shriram on the line, TPG would have to delicately balance both
its exit timing and valuation strategy. Of the three exit options usually deployed by most PE firms—IPO,
trade sale, and secondary sale—each had its own set of advantages and disadvantages (see Exhibit 5).
Do

20
Ibid.
21
“Sensex Surges 25.7 Percent in 2012; Best in Three Years,” First Post, December 31, 2012, accessed April 28, 2015,
www.firstpost.com/fwire/sensex-surges-25-7-percent-in-2012-best-in-three-years-574409.html.

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

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For an IPO exit strategy, the stock market boom would not last forever, but it provided a time-tested
option for a smooth exit (see Exhibit 6). TPG would have to consider an indirect ownership structure
in STFC, based on Shriram’s shareholding pattern (see Exhibit 7).
 A trade sale was an alternative that would require spending less time at the negotiating table and
avoiding the lengthy public disclosures required during an IPO. However, identifying the right
strategic partner for STFC and reaching an agreement on valuations would be challenges.

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 A secondary stake sale to another PE firm in India was the final option, but this would require more
time and effort to identify a financial buyer with enough capital and interest to buy TPG’s stake in
STFC.

To evaluate TPG’s potential exit, two common valuation multiples were considered: price to earnings
(P/E) ratio and enterprise value to earnings before interest, taxes, depreciation, and amortization
(EV/EBITDA) ratio. STFC’s valuation multiples relative to its peers looked ripe for selling. STFC’s P/E

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multiple stood at 13.63 times in the FY2011/12 period, while peers such as Sundaram Finance and Bajaj
Finance stood at 6.21 times and 11.95 times, respectively. STFC’s EV/EBITDA multiple stood at 1.11
times, compared to peers such as Sundaram Finance and Bajaj Finance whose EV/EBITDA ratios were at
0.88 times and 6.04 times, respectively. TPG was well aware that the typical PE investor would seek an
EV/EBITDA of three times on exit. TPG had a tough choice to make.
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tC
No
Do

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EXHIBIT 1: PRIVATE EQUITY AND VENTURE CAPITAL DEALS IN INDIA FROM 2005 TO 2012

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Value of Deals Number of Number of
Year
(US$ Billion) Deals Active Funds
2005 2.6 185
2006 7.4 296
2007 17.1 494 244

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2008 14.1 448 256
2009 4.5 216 181
2010 9.5 380 202
2011 14.8 531 238
2012 10.2 551 285

Breakdown of Deals
Sector 2011 2012

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Others 105 108
Telecom 5 0
Media and entertainment 9 21
Health care 29 44
BFSI* 48 41
Energy 35 19
IT and ITES† 135 225
Engineering and construction 28 14
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Manufacturing 72 34
Real estate 63 44
Total 531 551

* BFSI = Banking, Financial Services, and Insurance

†
IT = Information Technology, ITES = Information Technology Enterprise Solutions
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Source: Arpan Sheth and Sriwatsan Krishnan, “India Private Equity Report 2013,” Bain & Company, May 14, 2013,
accessed April 20, 2015, www.bain.com/publications/articles/india-private-equity-report-2013.aspx.

EXHIBIT 2: COMMERCIAL VEHICLE SALES IN INDIA (FY2011/12)

Domestic Commercial Year-over-Year

Segments
Vehicle Sales (Units Sold) Growth Rate (%)
No

Particulars FY2011 FY2012 FY2011 FY2012

LCV bus sales* 44,816 48,868 30.20 9.00
LCV truck sales 317,030 411,415 25.10 29.80
Total LCV sales 361,846 460,283 25.70 27.20
M&HCV bus sales† 47,938 49,882 11.30 4.10
M&HCV truck sales 275,121 299,334 36.30 8.80
Total M&HCV sales 323,059 349,216 31.90 8.10
Total CV sales§ 684,905 809,499 28.60 18.20
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* LCV = light commercial vehicle

†
M&HCV = medium and heavy commercial vehicle
§
CV = commercial vehicle

Source: ICRA Research Services, Indian Commercial Vehicle Industry: Demand Trends Turning Favourable (ICRA Limited,
2015), 5, accessed July 25, 2016, www.icra.in/Files/ticker/SH-2015-Q1-1-ICRA-Commercial%20Vehicles.pdf.

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EXHIBIT 3: SHRIRAM GROUP FINANCIALS

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Assets under Management (in US$ Billion)

Financial Year On Books Off Books

2008 2.75 0.80

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2009 3.26 0.97
2010 3.26 2.03
2011 3.61 2.96
2012 3.99 3.31

Total Income (in US$ Billion)

Financial Year Value

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2008 0.45
2009 0.67
2010 0.81
2011 0.98
2012 1.07

Profit and Loss Statement for the Year Ended March 31, 2012 (in ₹ Million)
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Income
Revenue from operations 58,891.72
Other income 47.05
Total 58,938.77
Expenditures -
Employee benefit expenses 3,700.56
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Finance costs 24,612.06

Depreciation and amortization 134.64
Other expenses 3,999.48
Provisions and write-offs 7,682.94
Total 40,129.66
Profit before taxation 18,809.10
Provision for taxation -
Current tax 6,864.49
No

Deferred tax (629.88)

Total tax expense / (income) 6,234.61
Provision after tax for continuing operations 12,574.50
Earnings per share -
Basic (in ₹) 5.56
Diluted (in ₹) 5.55
Nominal value of equity shares (in ₹) 1.00
Significant accounting policies
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EXHIBIT 3 (CONTINUED)

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Balance Sheet for the Year Ended March 31, 2012 (in ₹ Million)

EQUITY AND LIABILITIES

Shareholders’ funds
Share capital 2,263.25

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Reserves and surplus 57,659.88
59,923.13
Non-current liabilities
Long-term borrowings 146,868.40
Other long-term liabilities 18,368.58
Long-term provisions 13,690.56
178,927.53

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Current liabilities
Short-term borrowings 30,402.36
Trade payables 4,756.42
Other current liabilities 81,929.30
Short-term provisions 1,836.04
118,924.12
Total 357,774.78
ASSETS
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Non-current assets
Fixed assets -
Tangible assets 362.47
Intangible assets 14.62
Non-current investments 5,602.75
Deferred tax assets (net) 2,166.75
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Long-term loans and advances 157,297.13

Other non-current assets 1,036.67
166,480.39
Current assets
Current investments 33,941.72
Cash and bank balances 53,080.92
Short-term loans and advances 103,470.53
Other current assets 801.21
No

191,294.39
Total 357,774.78

Note: US$1 = ₹55 on July 1, 2012.

Source: Shriram Transport Finance Company, 33rd Annual Report 2011/12, accessed April 22, 2015,
http://stfc.in/pdf/annual-report/STFCAnnualReport2011-2012_a63eea.pdf.
Do

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 Page 11 9B16N051

t
EXHIBIT 4: LIST OF PRIVATE EQUITY INVESTMENTS IN SHRIRAM GROUP

os
Major investments made in Shriram Group since 2004
Company Amount
Company Type Investors (in US$ Million) Date
Shriram Retail Holdings Unlisted TPG Capital 120 September 8, 2004

Shriram Transport Finance
Shriram City Union Finance
rP
Listed TPG Newbridge 100 September 5, 2004
ChrysCapital, ICICI
Bank, Bessemer
Venture Partners,
Listed Asiabridge Capital 65 April 8, 2005
ChrysCapital, CPIM
Structured Credit
Fund, Merrill Lynch

yo
Shriram City Union Finance Listed Real Estate 43 November 6, 2005
Shriram City Union Finance Listed Norwest Financial 25 July 9, 2006
Shriram Transport Finance Listed ChrysCapital 13 February 5, 2007
Shriram City Union Finance Listed Norwest 3 August 9, 2007
Shriram Transport Finance Listed Reliance Capital 1 June 4, 2008
Shriram Transport Finance Listed FMO 1 October 4, 2008

Source: T.E. Narasimhan, “Why Private Equity Loves the Shriram Group,” Business Standard, January 31, 2012, accessed April
op
15, 2015, www.business-standard.com/article/companies/why-private-equity-loves-the-shriram-group-112013100007_1.html.

EXHIBIT 5: NUMBER OF PRIVATE EQUITY EXITS IN INDIA

Type of Private Equity Exits in India (2007–2012)

tC

40
35
30
Buy back
25
Strategic sale
20
No

Secondary sale
15
Others
10
5
0
2007 2008 2009 2010 2011 2012
Do

Source: “Private Equity Exits in India 2007–2012,” Venture Intelligence (database), accessed May 15, 2015,
www.ventureintelligence.com.

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Permissions@hbsp.harvard.edu or 617.783.7860
 Page 12 9B16N051

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EXHIBIT 6: INDIAN STOCK MARKET PERFORMANCE (2011–2012)

os
Indian Stock Market Performance (2011–2012)
25,000

rP
20,000
Sensex
15,000
Nifty
10,000 S&P500
DAX
5,000

yo
SCI

Source: Major World Indices, Yahoo Finance, accessed April 28, 2015, https://in.finance.yahoo.com/intlindices?e=asia.
op
EXHIBIT 7: SHAREHOLDING PATTERN IN SHRIRAM GROUP

Categories of shareholders as on March 31, 2012

tC

Number of Percentage of
Category of shareholder shares held shares held
Promoters and promoter group 103,278,335 45.64
Mutual funds/UTI* 5,291,284 2.34
Financial institutions and banks 208,345 0.09
Foreign institutional investors 88,798,540 39.24
Bodies corporate 10,159,776 4.49
Individuals 17,530,203 7.74
No

NRIs, OCBs, and foreign nationals† 376,880 0.17

Trust 247,618 0.11
Clearing members 408,882 0.18
Limited liability partnerships 705 0.00
Grand total 226,300,568 100.00

* UTI = Unit Trust of India

†
NRI = Non-resident of India, OCB = Overseas Corporate Body
Do

Source: Shriram Transport Finance Company, 33rd Annual Report, 2011/12, accessed April 22, 2015,
http://stfc.in/pdf/annual-report/STFCAnnualReport2011-2012_a63eea.pdf.

This document is authorized for educator review use only by Dr.naliniprava Tripathy, HE OTHER until August 2017. Copying or posting is an infringement of copyright.
Permissions@hbsp.harvard.edu or 617.783.7860