From area managers to staff training: Shriram stays the course for fusion

From bringing in experts in charge of five areas to training employees to introduce them to the products, Shriram Group kicked off the integration process on the ground, ahead of its planned mega merger.

The company has already appointed five Joint Managing Directors (JMDs) and also launched 50 pilot branches so far to see how the merged entity between Shriram City Union and Shriram Transport will work. The group has appointed PricewaterhouseCoopers to advise it on the post-merger integration process.

“The integration process is going smoothly. We have launched the pilot project in a few pilot branches through which we are carrying out several product launches. We have five geographies and leadership in place. They will oversee it from pilot study to implementation,” said Umesh Revankar, Vice President and Managing Director of Shriram Transport Finance (STFC). Other processes such as human resources, systems integration and finance are also on track. “By the time the legal (merger) date is reached, we should be fully integrated,” he added.

The five new JMDs are K Srinivas and Gouse Mohiddin Jilani from SCUF and Nilesh Odedara, Sudarshan B Holla and Sridharan P from STFC. Each of them has been part of the group for about 25 to 30 years. The planned super app called Shriram One – where all loan, savings and insurance products will be available on one platform – is also a key towards the new integration. Earlier, it was said that the one-time onboarding cost for the company would be around Rs 200 crore. “It’s as expected. NSE and BSE approvals have arrived. We have now sent the proposal to NCLT. The next process is the NCLT calling a meeting of shareholders and creditors. We should be on schedule for the first week of October or November,” Revankar said.

Gouse Mohiddin Jilani, Executive Director, Shriram City Union Finance Ltd; K Srinivas, Executive Director, Shriram City Union Finance

The company said system and people integration is underway and progressing well. It has already started cross-training staff at branch level to help them develop expertise in new products. The strategy is to train all employees on the diversified portfolio within six months.

Shriram Transport Finance Company and Shriram City Union Finance both work on a structure where each geographic unit is managed end-to-end by the management of that area – from sales to collection to profitability and growth. In line with the integration roadmap, the similar successful format will also be continued in the new entity Shriram Finance, under the leadership of the five JMDs.

Sudarshan B Holla, Nilesh Odedara

Sudarshan B Holla, Joint Managing Director – Shriram Transport Finance Co Ltd; Nilesh Odedara, Co-Managing Director, Shriram Transport Finance Co

“Each JMD will have its own management, marketing, sales and product teams, etc., and will operate according to local customs and demand. On the ground, each division can look like a stand-alone business. However, the general management of each division is still led by the central business policy. India is culturally so unique in every geography and this strategy will help us to be more grounded and have a strong customer connection,” a source said. The structure is effective from April 1, 2022.

“We have started pilot projects in 50 branches spread all over Pan-India and launched all the products there. The pilots will help us understand the market demand for the products and we will shape our strategy based on each geography,” the source added.

It was in December that the group announced the merger of Shriram Capital Ltd (SCL) and Shriram City Union Finance Ltd (SCUF) with Shriram Transport Finance Ltd (STFC), to create the largest retail NBFC in India named Shriram Finance Ltd (SFL). This merger would bring together all of its lending products – commercial vehicles, two-wheeler loans, gold loans, personal loans, auto loans and small business financing. The new entity may have combined assets under management (AUM) of over Rs 1.5 trillion, over 20 million consumers and a distribution network of around 3,500.

Dear reader,

Business Standard has always endeavored to provide up-to-date information and commentary on developments that matter to you and that have wider political and economic implications for the country and the world. Your constant encouragement and feedback on how to improve our offering has only strengthened our resolve and commitment to these ideals. Even in these challenging times stemming from Covid-19, we remain committed to keeping you informed and updated with credible news, authoritative opinions and incisive commentary on relevant topical issues.
However, we have a request.

As we battle the economic impact of the pandemic, we need your support even more so that we can continue to bring you more great content. Our subscription model has received an encouraging response from many of you who have subscribed to our online content. More subscriptions to our online content can only help us achieve the goals of bringing you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practice the journalism we are committed to.

Support quality journalism and subscribe to Business Standard.

digital editor

Previous Helmerich & Payne, Inc. (NYSE: HP) to post earnings of $0.09 per share in the third quarter of 2022, according to Capital One financial forecast
Next CO PO Calendar | May 2-8 | Content reserved for subscribers