Rating Rationale
April 18, 2017 | Mumbai
Sansar Trust March 2017 V
(Originator: Shriram Transport Finance Company Limited)
'Provisional CRISIL AAA (SO)/Provisional CRISIL BBB+ (SO)' assigned to Series A PTCs and Second Loss Facility 
Rating Action
Transaction Details Amount Rated
(Rs. Cr.)
Pool Principal (Rs. Crore) Original Tenure (Months)# Credit Collateral (Rs. Crore) Ratings/Credit Opinion Rating Action
Sansar Trust March 2017 V

Series A PTCs 849.72 849.72
56 86.0& Provisional CRISIL AAA (SO)@ Provisional Rating Assigned
Second Loss Facility 43.5 42.5 Provisional CRISIL BBB+ (SO) Equivalent@ Provisional Rating Assigned
1 crore = 10 million
* Series A PTC holders are entitled to receive timely interest and timely principal
#Indicates door to door tenure from pool cut-off date. Tenure computed from placement date is 55 months. Actual tenure will depend on the level of prepayments in the pool, and exercise of the clean-up call option
&Additionally, excess interest spread, amounting to around Rs.97.72 Cr (assuming zero prepayments), continues to provides credit support to the PTCs
@A prefix of 'Provisional' indicates that the rating centrally factors in the strength of specific structures, and will be supported by certain critical documentation by the issuer, without which the rating would either have been different or not assigned ab initio. This is in compliance with a May 6, 2015, Securities and Exchange Board of India (SEBI) directive, “Standardising the term, rating symbol, and manner of disclosure with regard to conditional/ provisional/ in-principle ratings assigned by CRAs”.
Detailed Rationale

CRISIL has assigned its 'Provisional CRISIL AAA (SO)' rating to the pass-through certificates (PTCs) and credit opinion of 'Provisional CRISIL BBB+ (SO)' equivalent to the second loss facility issued by Sansar Trust March 2017 V. The pool is backed by New and Used Heavy commercial vehicles (HCV), Light commercial vehicles (LCV), , Passenger vehicles (PV), Small commercial vehicles (SCV) and Construction Equipment (CE) loan receivables originated by Shriram Transport Finance Company Ltd (STFCL; 'CRISIL AA+/FAAA/Stable/CRISIL A1+'). The rating on the PTCs is based on the credit quality of pool cash flow, STFCL's origination and servicing capabilities, the transaction's credit enhancement and payment mechanism, and soundness of the transaction's legal structure.
The transaction has a 'par' structure. STFCL will assign the pool to Sansar Trust March 2017 V, settled by IDBI Trusteeship Services Ltd, which will issue the PTCs to investors. The PTCs are supported by the stipulated cash collateral and excess interest spread. The total credit support available in the transaction is as follows:

  • Opening overdue of Rs.4.09 Crore
  • Internal credit support in the form of scheduled EIS, aggregating Rs.97.72 Crore (9.4% of pool cash flows)
  • External credit-cum-liquidity collateral of Rs.86.0 Crore (8.23% of pool cash flows) to be provided by STFCL

This is a 'provisional' rating and will be converted into a 'final' rating based on receipt of the following documents:

  • Trust deed
  • Power of attorney
  • Information memorandum
  • Assignment agreement
  • Legal opinion
  • Trustee letter
  • Representations and warranties letter

Additional documents, if any, executed for the transaction should also be provided. A rating rationale/report indicating the conversion of the 'provisional' rating to 'final' post the receipt of all the required final legal documents will be published on the CRISIL website. Please click on the link below for detailed information on CRISIL's policy on provisional rating: Revision in CRISIL policy for assigning 'provisional' rating.
Key rating drivers and detailed description:

  • Superior pool selection;
    • The pool has exhibited strong characteristics when compared to the portfolio in multiple parameters, viz., IRR and geography
  • Good historical collection performance of portfolio
    • The portfolio performance of the originator has improved since last year and has remained stable over the past quarters. The 90+ delinquency of New vehicle loans and Used Vehicle loans, at a portfolio level, stood at 10.6% and 7.0% respectively, as of December 2016
  • Origination and servicing capabilities
    • The originator has a track record of more than 20 years in the vehicle financing business. The overall portfolio performance is an indicator of the strong origination and servicing abilities of the originator


  • Moderate presence of 1 month overdue contracts
    • At the time of securitisation, proportion of 1 month overdue contracts in the pool was 11% of principal

CRISIL has adequately factored these aspects in its rating analysis
About the Pool
The pool, mainly comprising used CV loans, has a good seasoning profile (weighted average net seasoning of 13.8 months). The pool is geographically diverse, with the top three states accounting for 34% of the principal. Moreover, the weighted average loan-to-value ratio is 68% and average ticket size is Rs 3.7 lakh.
About the Originator
STFCL, incorporated in 1979, is the flagship company of the Shriram group. The company is registered with the Reserve Bank of India as a deposit-taking, asset-financing non-banking financial company. STFCL provides financing for vehicles such as CVs (both pre-owned and new), tractors, and passenger vehicles. It has pan-India presence, with 853 branches and 803 rural centres as on March 31, 2016.
STFCL's total income and profit after tax (PAT) were Rs.5,260 Cr. and Rs.1,180 Cr., respectively, for fiscal 2016, against Rs.4500 Cr. and Rs.1030 Cr., respectively, for fiscal 2015.
Crisil Rated Pools
CRISIL has rated more than 40 securitisation transactions for STFCL and has outstanding ratings on thirteen transactions. Performance of all the pools is in line with CRISIL's expectations. Compliance process has been completed for eight transactions. CRISIL is receiving monthly performance reports pertaining to all CRISIL-rated STFCL originated securitisation transactions.

Note on complexity levels of the rated instrument:
CRISIL complexity levels are assigned to various types of financial instruments. The CRISIL complexity levels are available on www.crisil.com/complexity-levels. Users are advised to refer to the CRISIL complexity levels for instruments that they consider for investment. Users may also call the Customer Service Helpdesk with queries on specific instruments.
Annexure - Details of Instrument(s)
Type of Instrument Rated Amount (Crores) Date of Allotment Maturity date* Coupon Rate (%) (Annualised) Outstanding
Credit cum liquidity Enhancement (Rs Crores)
Series A PTCs 849.72 30-Mar-17 22-Oct-21 7.50% Provisional CRISIL AAA (SO) 86.0^
Second Loss Facility 43.5 22-Oct-21 -- Provisional CRISIL BBB+ (SO) Equivalent 42.5
*Indicates door to door tenure. Actual tenure will depend on the level of prepayments in the pool, and exercise of the clean-up call option
^Additional credit support includes Rs 97.69 crore in form of scheduled EIS (assuming zero prepayments)
Annexure - Rating History for last 3 Years
  Current 2017 (History) 2016  2015  2014  Start of 2014
Instrument Type Quantum Rating Date Rating Date Rating Date Rating Date Rating Rating
Series A PTCs LT 849.72 Provisional CRISIL AAA (SO)                  
Second Loss Facility LT  43.5 Provisional CRISIL BBB+ (SO) Equivalent                  
Table reflects instances where rating is changed or freshly assigned. 'No Rating Change' implies that there was no rating change under the release.
Links to related criteria
CRISILs rating methodology for ABS transactions
Evaluating risks in securitisation transactions - A primer
Legal analysis in structured finance transactions

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