Also see: Shriram City Union Fin's PAT rose by 62.98% to Rs 51.62cr

Here is a verbatim transcript of the exclusive interview with Arun Duggal on CNBC-TV18. Also see the accompanying video.

Q: Has Norwest Ventures been in touch with you regarding partnership in your company in terms of raising their stake further because the statement that has come out of Norwest is that they are very much interested in the business model of Shriram City Union Finance? Has there been any communication between the two parties?

A: Ours is a publicly listed company. There is a lot of public information based on which they probably made the decision. When we learnt that they have bought this stake, we were delighted because they are a wonderful name to have on your shareholder register and Promod Haque has a great reputation as an investor.

Q: Are you open to some sort of a placement in case they want to increase the stake? As of now they have bought a stake from the open market from Merrill Lynch. In future if they want to increase that stake, would you be open to that?

A: We will have to consider at that time. At the moment, the company is very well capitalised. We have very good investors, excellent other investors as well including TPG Capital, ChrysCapital, and Bessemer. So, we are delighted to have these very sophisticated investors invest in our company.

Q: Let us talk a bit about the business dynamics as well. What has been the cost of raising funds for the company in the last quarter or in the last six months? What have been the average earnings?

A: Late last year, around the timeframe of September-October, we as well experienced a little bit of constraint on availability of funds. But pretty soon thereafter, around November-December, we started getting approvals from banks that had been our lender and there is a wide variety of banks that we borrow money from.

At the moment, we are very liquid and we have backup lines of credit. So, there is no constraint on the liquidity of the company. In fact, we are in a very comfortable position. As far as the cost of funds is concerned, I am not totally up to speed on what is the latest cost of funds. But it is in the range of 12-12.5%.

Q: You have about 1.5 million customers. Are you the market leader in this category, and is there a target that you are looking at in terms of raising this customer base?

A: We are obviously concentrated at the moment in the four southern states. But we have opened branches all over the country and gradually we will be growing the customer base.

We are a very cautious company. So, we are not going to go gangbusters and pump-up loan totals in a very dramatic manner. We will do it thoughtfully and carefully.

Q: How have delinquencies or bad loans performed on a year-on-year basis?

A: I looked at the numbers a few days ago. Our delinquency is less than 1%. Our net NPAs have only increased marginally, perhaps 0.02%. So, we have been very careful in managing the credit risk of our portfolio and our people have done an excellent job in collecting. So, delinquency is totally under control and has not increased.