Optimistic Outlook for Financial Year 2026: Insights from Rajiv Lochan of Sundaram Finance
Sundaram Finance Eyes Growth Amid Economic Challenges
Chennai, May 26, 2025 — Sundaram Finance Ltd., a leading player in the financing sector for commercial vehicles and agricultural equipment, is optimistic about a rebound in financial year 2026 following a challenging financial year 2025. Managing Director Rajiv Lochan shared insights on the company’s performance and future outlook during a press briefing on Monday.
In FY25, Sundaram Finance reported a 9% increase in standalone disbursements, reaching ₹28,405 crore, up from ₹26,163 crore the previous year. The company’s net profit also saw a modest rise of 6%, totaling ₹1,543 crore. Notably, when excluding an exceptional item from FY24, net profit growth stands at a robust 16%.
Lochan attributed the subdued performance in FY25 to several external factors, including an extreme summer, general elections, a lackluster festive season, and global uncertainties stemming from tariff disputes and geopolitical tensions. "Customer outlook was cautious, and economic growth was primarily supported by government capital expenditure, which fell short of previous year levels," he explained.
Looking ahead, Lochan expressed optimism for improved macroeconomic sentiments, particularly in rural areas, thanks to forecasts of above-normal monsoons by the India Meteorological Department (IMD) and strong procurement activities. He also highlighted anticipated improvements in urban areas driven by increased government spending on infrastructure and income tax benefits outlined in the recent Union Budget.
"As private consumption improves, we expect private sector capital expenditure to pick up," Lochan stated. He emphasized that Sundaram Finance is well-positioned for steady growth, maintaining best-in-class asset quality and resilient profitability.
However, he cautioned that global factors, such as ongoing tariff wars and geopolitical issues, remain critical areas of concern. In light of its performance, the company has declared a final dividend of ₹21 per share, reflecting its commitment to shareholder returns.
As Sundaram Finance navigates these complexities, all eyes will be on its strategies to harness growth opportunities in the evolving economic landscape.
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