S&P: Shriram Transport BB+

Standard & Poor’s said it assigned a BB+ long-term and B short-term issuer credit ratings to Shriram Transport Finance Co. Ltd.

The outlook is stable.

The rating reflects the company’s good business position, capitalization and earnings profile, S&P said.

The company’s inherently high credit costs temper these strengths, the agency said.

The company’s stand-alone credit profile is assessed at BB+.

The agency said it believes that Indian finance companies like Shriram Transport face greater industry risks relative to banks because financial companies usually have no access to central bank funding and have lower barriers to entry and less stable revenues.

Financial companies also have less onerous regulations, notwithstanding some requirements on capital adequacy, asset quality and asset-liability management, S&P said.

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