Macquarie downgrades Shriram Transport Finance to ‘neutral’, here’s why

Macquarie has downgraded Shriram Transport Finance to a 'neutral' and they have a target price of Rs 1,250.

This downgrade essentially on the back of the merger of Shriram Transport with the other two Shriram Group companies which is  Shriram City Union and Shriram Capital.

Macquarie believes there are no large synergies from this merger because all the three companies have a very widely differentiated verticals and product line. So there are no large synergies from this merger plus there is going to be a change in leadership.