Japan's MUFG Buys 20% Stake in Shriram Finance for ₹39,600 Cr, Eyes India Growth

• Japan's MUFG to acquire a 20% equity stake in Shriram Finance for approximately ₹39,600 crore, marking a significant foreign investment in India's NBFC sector.
• The deal involves preferential allotment of 47.11 crore new equity shares at ₹840.93 per share, pending RBI approval.
• MUFG will gain two board seats on Shriram Finance and has signed a strategic partnership MoU to enhance cooperation in lending and credit.
• A non-compete clause includes MUFG paying Shriram Ownership Trust $200 million (₹1,650 crore).
• Experts believe this will strengthen Shriram Finance's balance sheet, provide cheaper capital, and improve valuation, reflecting foreign investor confidence in India's financial sector.

Why It Matters: MUFG's ₹39,600 Cr investment in Shriram Finance signals strong foreign confidence in India's NBFC sector.