TVS Motor increases stake in TVS Credit Services with ₹282 crore investment

TVS Motor Company informed the bourses that following this investment, its shareholding in TVS Credit Services Limited has increased from 80.53% to 80.69% on a fully diluted basis.

TVS Motor Company said that TVS Credit Services is registered with the Reserve Bank of India (RBI) as a non-deposit taking Non-Banking Finance Company since April 13, 2010. The company specialises in financing two-wheelers, tractors, used cars, consumer durables, used commercial vehicles and MSME loans. As of March 31, 2024, TVS Credit Services reported a turnover of ₹5,789.57 crore, with a Profit After Tax (PAT) amounting to ₹571.83 crore and a net worth of ₹3,865.48 crore, according to the regulatory filing.

The investment is intended to strengthen TVS Credit Services’ capital adequacy ratio and support its overall corporate needs. The allotment of the newly subscribed equity shares was completed on June 28, 2024.

This acquisition qualifies as a related party transaction since TVS Credit Services is a subsidiary company. The transaction has been executed at arms’ length, based on a valuation report obtained from a registered valuer.

On June 27, in a separate exchange filing, TVS Motor Company said that it has officially incorporated a wholly-owned subsidiary named TVS Motor Company DMCC in Dubai. The company received the intimation and Certificate of Incorporation for TVS Motor Company DMCC on the same day.

Last month, the leading two-wheeler maker said that it would be collaborating with CSC Grameen eStores to promote its line of commercial vehicles, particularly its three-wheelers. Through this partnership, CSC Village Level Entrepreneurs (VLEs) will be able to function as local points of contact for commercial vehicles made by TVS Motor Company. In collaboration with the TVS three-wheeler dealer network, VLEs will manage enquiries, expedite transactions, supervise test drives and plan car deliveries.

TVS Motor Company Ltd shares closed 0.37% lower at ₹2,356 apiece on the NSE.