Umesh Revankar, the executive vice-chairman of Shriram Finance, said Shriram Finance would focus on expanding its micro and small enterprise operations in northern, central and eastern states of India.

“We will focus on our main business, like commercial vehicles and two-wheelers (finance). Also, we want to expand the micro and small business to the northern, eastern and central states of India as we think there is huge scope to increase lending. Right now, we are mostly in the southern and western states,” Revankar said.

Currently, 80% of Shriram Finance’s branches are in the southern and western states, while the remaining 20% ​​are in the northern and eastern states.

Over the next three years, the company expects its micro, small and medium enterprise (MSME) portfolio to increase to 15% of its total loan book from 11%.

The company announced its December quarter results on Tuesday, in which consolidated net profit tripled year-on-year to nearly Rs 1,802 crore on the back of growth in assets under management (AUM).

“We should be able to grow our AUM at a CAGR of 15% over the next three years. Today, our AUM growth rate is about 13.2%, so we are almost close to the target,” he said.

The company saw improvement in Gross Stage 3 Assets and Net Stage 3 Assets in the December quarter. “We cannot say that we will grow our non-performing asset ratio in the future, as most of our customers are businessmen, truck operators and self-employed individuals. But we are chaste on our credit cost,” he said. The company aims to keep its credit cost around 2% over the long term.