Shriram Transport Finance to tap large global investors to seek re-election of Punit Bhatia

MUMBAI: Shriram Transport Finance (STF) will reach out to large international institutional investors, including Fidelity Investment, T Rowe, and Norges Bank Investment Management, as it seeks the re-election of non-executive director Punit Bhatia, who is also the country head of TPG Capital Asia.

“We want to convince our shareholders amicably as Bhatia has contributed significantly in helping grow the company,” Umesh Revankar, managing director, Shriram Transport Finance, told ET.

“There is no conflict with shareholders. We are just aiming to pave the way for our future growth.”

These top investors own STF shares of about 1.2-5.09% each.

Two weeks ago, STF held its annual general meeting where the management brought in a resolution to re-appoint Bhati.

Minority shareholders voted against the proposal citing his 50% attendance in board meetings versus 75% desired by proxy advisory firms.

Bhatia was on the boards of three companies, including Shriram Capital and Shriram City Union. The industry veteran, who retired before the company’s 41 annual general meeting, is an alumnus of IIM Calcutta.

“Although shareholders are unhappy with Bhatia’s attendance, we have always received his guidance, and he is always accessible,” said Revankar. The company is also in talks with Bhatia, seeking to regularise his attendance in board meetings after the end to the pandemic.

The nomination and remuneration committee and the board considered that the re-appointment of Bhatia is in the interest of the company, STF wrote in its annual report.

It issued a public statement for re-appointment after the resolution failed to win majority votes at the AGM.

Meanwhile, collections are rising and should reach about 90% in September.

“The rural economy is intact and showing some green shoots,” said Revankar. Repayments are likely to rise in the festival season.

The non-banking finance company has nearly doubled its cash levels. STF now has about Rs 10,000 crore of cash in hand, which can cover liabilities of six months. In April-May, the buffer was less than half of what it now is.