TIME TO BUY NBFCs
Indian Economy & Market|May 2023
The RBI's decision to halt the rate hike in the April MPC meeting is a welcome relief for NBFCs as it will prevent a decline in NIM and simultaneously boost loan growth.
TIME TO BUY NBFCs

The current state of macro stability is favorable and better than ever before. Inflation seems to have peaked out, and as a result, the interest rate has also peaked out, which was evident in the last policy. If the monsoon is good, it is expected that the rural demand will pick up. The GDP growth may hover around 6.5% to 7 per cent.

IN a surprise move, after hiking repo rate by a cumulative 250 bps over the past year, the apex bank of India, decided to pause the rate hike in its last policy meeting. This has a positive spillover towards all the rate sensitive sectors including financial sector. This is clearly visible from the outperformance of Nifty Financial Services, which is constituted by banks and other financial companies, over Nifty 50. In last one year ending May 05, 2023 it has generated return of almost 17 per cent compared to just 8 per cent by Nifty 50. Even from the time when the rate pause was announced in the month of April, Nifty Fin Services index has outperformed Nifty 50 by 200 basis points.

NBFCs & Interest Rate 

Even within the financial sector it was NBFCs that are likely to disproportionately benefit from the rate pause decision of the Reserve Bank of India. Shares of many companies from this sector are already trading at their 52-week high in last couple of weeks. NBFC have been under pressure in the last few quarters and its strain was felt on the net interest margins due to rising borrowing cost after the Reserve Bank of India move to hike the repo rate to fight against inflation. This had increased the cost of borrowing for NBFC who lack the low cost of deposits such as current account and savings account that a bank enjoys. Hence, they are likely to more benefit from Reserve Bank of India’s rate pause.

Diese Geschichte stammt aus der May 2023-Ausgabe von Indian Economy & Market.

Starten Sie Ihre 7-tägige kostenlose Testversion von Magzter GOLD, um auf Tausende kuratierte Premium-Storys sowie über 8.000 Zeitschriften und Zeitungen zuzugreifen.

Diese Geschichte stammt aus der May 2023-Ausgabe von Indian Economy & Market.

Starten Sie Ihre 7-tägige kostenlose Testversion von Magzter GOLD, um auf Tausende kuratierte Premium-Storys sowie über 8.000 Zeitschriften und Zeitungen zuzugreifen.

WEITERE ARTIKEL AUS INDIAN ECONOMY & MARKETAlle anzeigen
NEW INVESTMENT PRODUCT CATEGORY IS SEBI'S LATEST MOVE COMMENDABLE?
Indian Economy & Market

NEW INVESTMENT PRODUCT CATEGORY IS SEBI'S LATEST MOVE COMMENDABLE?

The Securities and Exchange Board of India (SEBI) has introduced a consultation paper proposing a new investment product category aimed at addressing a specific market need. This proposed asset class would offer investment options that sit between mutual funds (MFS) and PMS, filling a gap and providing greater flexibility in portfolio management. The new investment vehicle is designed for investors who are prepared to take on riskier market positions but find PMS schemes or AIFs out of reach. SEBI after reviewing the feedback and finalizing the regulations through stakeholder discussions, may issue the final regulations.

time-read
5 Minuten  |
August 2024
DECODING THE CHINA MYTH
Indian Economy & Market

DECODING THE CHINA MYTH

Myths die hard. Among these is the great myth that China's poised to take over the world. Here, James Rickards debunks that myth.

time-read
7 Minuten  |
August 2024
What Is In Store For The Indian Economy?
Indian Economy & Market

What Is In Store For The Indian Economy?

Until the 2014 Lok Sabha elections, when the Bharatiya Janata Party secured 282 seats and Narendra Modi ascended to power, India experienced 21 years of coalition governments. A decade later, the BJP holds 240 seats in the Lok Sabha, and India is once again governed by a coalition. Fitch has indicated that coalition politics and a weakened mandate for the NDA could hinder the passage of ambitious reform legislation. It raises the question: Do coalition governments impede the economic reform agenda?

time-read
5 Minuten  |
July 2024
Transforming The Indian Stock Market
Indian Economy & Market

Transforming The Indian Stock Market

With a rising number of millennials, Gen Z investors, and tech-savvy traditional investors, Robo advisors are making a significant impact on the FinTech and WealthTech sectors. Factors like growing per capita income, favourable demographics, and increasing smartphone and internet Usage further enhance India’s potential as a robust market. Al’s role in stock market analysis is unquestionably growing. It enhances rather than replaces human judgment, providing powerful tools for informed investment decisions.

time-read
6 Minuten  |
July 2024
Rudra Global Infra Products Ltd.
Indian Economy & Market

Rudra Global Infra Products Ltd.

READY FOR EXPONENTIAL GROWTH WITH ENTRY INTO AEROSPACE & DEFENCE SECTOR

time-read
5 Minuten  |
July 2024
Dividend Powerhouses Best 5 Stocks for Yield and Growth
Indian Economy & Market

Dividend Powerhouses Best 5 Stocks for Yield and Growth

Enhance your investment strategy in these volatile times with these highyield dividend stocks known for their strong performance and reliability.

time-read
8 Minuten  |
July 2024
Face to Face
Indian Economy & Market

Face to Face

\"We believe ourselves to be service providers and not any goods manufacturer\"

time-read
4 Minuten  |
July 2024
THE REALITY OF CORPORATE ESG INITIATIVES
Indian Economy & Market

THE REALITY OF CORPORATE ESG INITIATIVES

Today, environmental, social, and governance (ESG) considerations dominate business discussions and have become an integral part of the strategies of many organisations in different industries. While some companies are grappling with these new standards and commitments, others, already aligned with the Sustainable Development Goals (SDGs), are well prepared to meet the evolving regulations and standards related to corporate social responsibility (CSR) and ESG.

time-read
4 Minuten  |
July 2024
Standard Capital Markets Ltd. Incorporates Subsidiary for Insurance Broking
Indian Economy & Market

Standard Capital Markets Ltd. Incorporates Subsidiary for Insurance Broking

Standard Capital Markets Ltd., a leading player in the financial services sector, has announced that it has incorporated a subsidiary under the name of “Standard Insurance Broking Ltd.” to act as a Direct broker under the Insurance Regulatory and Development Authority of India (Insurance Brokers) Regulations, 2018.NOC of Insurance Regulatory and Development Authority of India already taken and now company will also apply for taking Insurance Broking License of Insurance Regulatory and Development Authority of India (IRDAI).

time-read
2 Minuten  |
July 2024
THE IMMINENT MIDDLE EAST WAR
Indian Economy & Market

THE IMMINENT MIDDLE EAST WAR

Recent intelligence from a variety of sources points to an Israeli war against Hezbollah, which is an Iranian proxy. Hezbollah is systematically attacking Israeli bases, radars, intelligence-collections facilities and other defense system components. Now the attacks are spreading to include Israeli settlements in the West Bank and Galilee. You’re just not hearing about it in the mainstream media. These attacks have three effects: They break down Israeli military and intelligence systems, terrorize the civilian population and handicap Israel’s ability to conduct air attacks on Syria or Lebanon. James Rickards points out why all these are imminent.

time-read
5 Minuten  |
July 2024