Why oil prices could cap gains for Shriram Finance despite strong Q1

Shriram Finance posted strong Q1FY27 results with net interest income surging 33.5 percent year-on-year to about 7,706 crore rupees and core pre-provisioning operating profit growing nearly 33 percent to around 5,084 crore rupees. Asset quality was stable with credit costs at 1.66 percent, and management maintained its 18 percent AUM growth guidance for FY27, expecting a softer Q2 around 15 percent. However, nearly 47 percent of AUM is exposed to commercial vehicles, so rising diesel costs from elevated crude oil prices could cap stock gains until oil stabilizes; the stock trades at about 18 times estimated FY27 earnings versus 26 times for Bajaj Finance.