Religare enters commercial vehicles financing

Chennai: Religare announced its entry into motor vehicle financing, through a tie-up with Pune-based Kumar Motors Pvt Ltd, which manufacturers three-wheeler cargo vehicles.

This year, Religare Finvest Ltd, a wholly owned subsidiary of Religare Enterprises Ltd and a non-banking finance company, expects to finance 10,000 of the vehicles, lending about Rs 100 crore. This is but a small part of Religare’s loan portfolio of around Rs 2,000 crore.

However, at a press conference here Mr Shachindra Nath, Group COO, Religare Enterprises, said that the company would get deeper into commercial vehicles financing, especially financing purchases of used vehicles.

Religare Finvest’s portfolio comprises loans against shares, loans against property and personal loans. Loans against shares accounts for three-fourths of the company’s loan book.

Kumar Motors’ Managing Director, Mr Rajeev K. Nair, said at the press conference that the company got into commercial three-wheeler production about two years ago, investing Rs 15 crore into the manufacturing facility.

Mr Nair, who claimed expertise in designing vehicles, said that Kumar Motors would aim to achieve a 3 per cent share of the 600,000-units market for cargo three-wheelers, in two years. He said that Kumar Motors’ three-wheelers are at least Rs 10,000 cheaper than the competition.

Mr Nair refused to disclose either the company’s turnover or the number of vehicles sold last year. However, he said that the turnover of the Kumar Group last year was Rs 50 crore.

Religare Enterprises is the financial services arm of the Ranbaxy Group. Through its subsidiaries, it is into a range of financial services such as shares, commodities and insurance broking, venture and realty capital and investment and merchant banking. It also runs an ‘art fund’. Through its joint ventures, Religare Enterprises is also getting into life insurance, mutual funds, wealth management and film financing.