The second coming: From credit roots, Shriram Group now eyes an equities empire

Summary

Beyond truck loans and balance sheets, Shriram Group is chasing India's retail investing boom. Can an 89-year-old founder's legacy and a high-touch ground network beat Silicon Valley-style discount apps? We take a deep dive into the conglomerate's high-stakes bet.

Mumbai: In the first week of June, a group of 50 executives from Shriram Group's revamped capital markets business descended on Taj Fisherman's Cove Resort in Chennai, overlooking the tumultuous Bay of Bengal. The offsite had a star attraction: a speech by the 89-year-old founder of the group.

R. Thyagarajan, the octogenarian who set up the group in 1974 to meet the credit demands of India's underbanked population, wanted to instill a sense of ownership in those present. "Don't take instructions blindly. Our hierarchy is only for the external world. Internally, we are all equal," Thyagarajan was quoted as having said at the event.

Metaphorically, what he said internally reflects what the group plans to do externally: democratize access, allowing more people to access investment avenues.

While the group has had some presence in stockbroking through a little-known business in Kolkata, the plan is now to make a big bang entry. Today, Shriram Group is largely known for its lending business; Shriram Finance, the lending arm, pulled in revenue of nearly ₹50,000 crore in 2025-26.

According to group executives, the revamp has three components: mutual funds, direct access to capital markets through a brokerage platform, and wealth. The strategy is to be present in a segment that it so far lacked, allowing existing and new customers of the group to use its services to enter the capital markets.

The process, which started about four years ago with a push to revive a fledgling mutual fund business, is in its final stages now. In February 2022, Mission1 Investments LLC agreed to infuse ₹35 crore in Shriram Asset Management Company, followed by Sanlam -- South Africa's largest asset manager -- buying a 23% stake in the AMC in May 2025. The business now manages assets worth ₹1,170 crore.

For the Shriram Group, capitalizing on India's capital markets and wealth management boom comes late, as many banks and non-banks have already joined the party, all aiming for a slice of this booming market.

According to consulting firm EY, over 100 million Indians could enter long-term investing by 2035, driven by rising participation from smaller cities, young investors, women and digitally connected households.

The combined direct and indirect household ownership of equities reached approximately $800 billion in March 2026, growing at an annualized rate of nearly 30% since March 2020, EY stated in a September report.

The wealth road

Here's how the conglomerate is structuring its businesses.

Shriram Capital, the parent company headed by group veteran Subhasri Sriram, sits at the top. The lending business, Shriram Finance, is an associate company of Shriram Capital. As per CareEdge Ratings, Shriram Capital largely depends on Shriram Finance for its dividend income. The dividend income contributed 86.07% of last fiscal year's total income.

Shriram Capital has four subsidiaries: Shriram Life Insurance Company Ltd, Shriram General Insurance Company Ltd, Shriram Asset Reconstruction Pvt. Ltd, and Shriram Investment Holdings Pvt. Ltd.

In turn, Shriram Investment Holdings has a clutch of subsidiaries, including Shriram Credit Company, which houses the broking and asset management business. The wealth management business under Shriram Wealth is an arm of Shriram Investment Holdings.

"Earlier, whenever the international market sneezed, we caught a cold. "There is one big change which has happened in the Indian equity markets today," Subhasri Sriram, managing director and chief executive officer of Shriram Capital said in an interview in Mumbai. "After all the flight of foreign institutional investors (FIIs), Indian investors are standing their ground, keeping the market up."

Foreign investors have relentlessly been selling Indian equities. Since the beginning of the year, overseas investors are net sellers of $30.4 billion in equities, compared to $18.9 billion in 2025, per data from the National Securities Depository Ltd.

Sriram said that the rich and the middle class always had the options to invest but for a majority of Indians, probably the only product, which was slightly more transparent and liquid, was a fixed deposit.

"If Indian savings are getting directed to alternative products -- could be mutual funds, equity and for the wealthier, alternatives or portfolio management services -- that is where the Shriram Group is," she said.

A January study by the Securities and Exchange Board of India (Sebi), India's market regulator, stated that retail investors have increasingly diversified into equities and mutual funds, shifting away from traditional savings in bank deposits, gold and real estate. The study found that mutual funds and listed equities are the most widely recognized securities market products among households, substantially higher than other securities.

Aggregate mutual fund investments increased from ₹36 trillion in August 2021 to ₹87 trillion in August 2026, more than doubling in five years.

"Today, the market is more mature. The stability in the market is significantly different than it was 20 years ago," she added.

A study by Sebi stated that retail investors have increasingly diversified into equities and mutual funds, shifting away from traditional savings in bank deposits, gold and real estate.

The path to the revamped equity market foray is through Way2Wealth Brokers Pvt Ltd. In 2020, the group bought 85.53% in Way2Wealth from Coffee Day Enterprises for an enterprise value of ₹65 crore. Sriram said that the acquisition was under discussion for almost ten months and was eventually completed in November 2020.

At that point, it was not the only broking company the group had. Shriram Insight, based in Kolkata, was a profitable stockbroking company that had existed for 30 years.

Interestingly, Way2Wealth was among those named in the much-publicised co-location and dark fibre case.

Between 2009 and 2016, over a dozen brokerages were given preferential access on NSE's colocation premises under the previous exchange management to the disadvantage of others. The exchange has settled the case.

Way2Wealth will now get a fresh coat -- a Shriram branding. It will be called Shriram Financial Services Pvt Ltd. However, Shriram Insight will continue to remain a separate entity.

The human touch

While it is easier said than done, experts are hopeful.

"Their foray into the capital markets business has not exactly been a tearaway success, but the fine pedigree of the group should enable them to have a shy at the highly competitive landscape," said U.R. Bhat, co-founder of Alphaniti Fintech Pvt. Ltd.

To execute its strategy, the group has appointed Amit Golia as the managing director of Shriram Financial Services. He previously worked at Axis Securities and SBI Cap Securities as chief business officer. Before joining Shriram Financial Services, Golia spent eight months as the chief executive of fintech research platform Marketsmojo.

Golia said that he does not see the two businesses -- Shriram Financial Services and Shriram Insight -- as necessarily competing.

"They address different segments and distribution models. Shriram Financial Services is being rebuilt as a digital first, advice-led investment platform whereas Shriram Insight continues to leverage its strong relationship-led franchisee," said Golia.

According to him, the group also does not want to win by building another super app although it would offer several investment propositions -- equities, derivatives, margin trading facility (MTF), mutual funds, exchange-traded funds, IPOs, bonds and other investment products.

Several companies are trying to build a super app, or a platform to address multiple investment needs. The idea is that a customer once logged in will engage more often as he/she will have a basket of products to choose from.

"Maybe we will call it a 'super platform'. We want to build an advice-led investment platform combining the convenience of a Groww or Zerodha with the human touch and distribution strength of Shriram," he said.

The investment experience and the advice layer is the differentiation, he believes. A second differentiator is the combination of digital and assisted investing. He said that unlike a pure DIY (do-it-yourself) platform, Shriram Group can leverage its distribution and relationship ecosystem to provide human assistance where the customer needs it, while retaining the convenience and scalability of a digital platform.

The group will also provide loan against shares, loan against mutual funds, and margin trade financing.

Shriram Financial Services has increased its focus on the MTF business -- the MTF book rose eight times to ₹8 crore in 2025-26 from the previous year and further to ₹49 crore as on 30 June, according to a note by CareEdge Ratings. Going forward, the company plans to expand the MTF book to ₹150-170 crore by 2026-27, CareEdge Ratings said.

In MTF, an investor can buy stocks by paying only a partial upfront amount while the brokerage house funds the rest of the purchase price, on which it earns an interest from the client ranging between an annualised 9 and 12%.

On 7 September, CareEdge Ratings assigned a AA- rating to ₹100 crore non-convertible debentures of Shriram Financial Services. While saying that the company's rating factors in adequate capitalization, it warned that the ratings remain constrained by its modest scale of operations, moderate profitability metrics, and inherent risks associated with the competitive capital markets business.

Other challenges include a rangebound market.

The Nifty 50, a stock market index, hasn't gone anywhere since 27 September 2024 when it hit a record high of 26,277.35. It plunged 17% on 7 April 2025, following US president Donald Trump's tariffs.

From there, it took eight months for the benchmark to recover and reach a high of 26,373.2 on 5 January. However, it again fell to a low of 22,182.55 on 2 April in the wake of the West Asia war and India being bypassed by the global AI trade.

The roller coaster continued with an 11.7% rally to 24,774.3 on 3 August amid rising hopes of resolution to the West Asia crisis. However, the truce proved short lived with the theatre of war expanding to the Red Sea from Hormuz.

The impact on inflation drove the US 10 year benchmark yield up to 5.34% on Thursday, the highest since 2002. Consequently the market plunged 10% since early August to 22,217.3 at the end of the latest trading week on 1 October.

This volatility can impact participation as the market hasn't given a decisive breakout for two straight years, raising concerns.

"If the cash market remains as volatile for a prolonged period, brokerage revenues will be hit," said S.K. Joshi, consultant at Khambatta Securities.

The timing

Experts believe that stronger distribution is key to ensuring more Indians have access to financial products.

Consulting firm PwC and industry lobby group Ficci said in a joint report in May that the next chapter of India's financial growth will be defined by distribution models that bring access, guidance, and accountability together under one roof. According to data presented in the report, penetration of bank deposits was 73% of GDP in 2024-25, whereas mutual fund penetration and insurance penetration were 20% and 4%, respectively.

Citing market regulator Sebi's Investor Survey 2025, it said that of 337.2 million households, only 9.5% are investors (32.1 million); another 53.5% are aware of securities products but do not invest; and 37% are unaware.

The Shriram Group sees a role here -- bringing in more people to the investing fold.

"Our ambition is to make investing accessible across customer segments and geographies...from emerging customers in smaller towns to affluent customers in larger cities by combining technology with last mile connectivity," Golia said.

The timing appears to be just right for the conglomerate's second coming. From truckloads filled with credit, it is all set to pivot to the equities gravy train.