Investors continue to dump NBFC, housing finance stocks tank up to 9% on persistent worries over liquidity constraints
6 years, 3 months ago

Investors continue to dump NBFC, housing finance stocks tank up to 9% on persistent worries over liquidity constraints

Firstpost  

Liquidity concerns in the NBFC space have hit investor sentiment of late, with shares of many of these companies tumbling sharply. New Delhi: Shares of NBFC and housing finance firms continued to witness selling pressure Friday, falling up to 9 percent on persistent worries over liquidity constraints. The scrip of Indiabulls Housing Finance plunged 8.91 percent, Reliance Home Finance 8.43 percent, DHFL 5.08 percent, PNB Housing Finance 4.46 percent and LIC Housing Finance 1.14 percent on BSE. Shares of Muthoot Capital Services fell 4.98 percent, Manappuram Finance 4.17 percent, Shriram City Union Finance 2.63 percent and Motilal Oswal Financial Services 0.25 percent. Shares of NBFC and housing finance firms continued to trade weak Thursday also, plunging up to 8.5 percent.

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History of this topic

Markets Mojo picks LIC Housing as ‘stock of the month’ for October; 6 reasons why
1 year, 2 months ago

Markets Mojo picks LIC Housing as ‘stock of the month’ for October; 6 reasons why

Live Mint  

After an over 41 percent surge between April and September, brokerage house Markets Mojo picked LIC Housing Finance as its top pick for the month of October. The management indicated that loan book growth could be at 12-15 percent in the current financial year as against 9 percent of FY2023, noted the brokerage. NIM: Despite LIC Housing Finance seeing its …

NBFCs relying more on bank loans: RBI
1 year, 3 months ago

NBFCs relying more on bank loans: RBI

Live Mint  

Mumbai: Domestic non-banking financial companies, especially those in the upper-layer category, are increasingly relying on bank borrowings as their primary source of funding, according to an analysis in Reserve Bank of India ’s September bulletin. “During the assessment period, NBFCs’ reliance on banks increased steadily due to low interest environment and lag monetary policy transmission," the article said. Direct bank …

An analysis of top Housing Finance Companies in India
2 years, 9 months ago

An analysis of top Housing Finance Companies in India

Live Mint  

The Indian housing finance market witnessed a decent rise in home loan outstanding of 16% from fiscal 2015 to 2020. Profitability 2021 2020 2019 2018 ROCE 8.05 10.2 9.56 8.96 ROE 9.67 14.48 10.12 9.51 ROA 1.74 2.46 1.66 1.38 EBIT Margin 33.44 46.87 45.94 43.65 Net Margin 9.75 15.20 10.59 8.99 Cash Profit Margin 10.01 15.44 10.72 9.17 During …

KKR to step up real estate financing
4 years, 2 months ago

KKR to step up real estate financing

Live Mint  

Bengaluru: Real estate focused non-banking financial company KKR India Asset Finance Ltd is stepping up lending even as overall financing to the sector remains subdued, said a top executive. We also think that the residential market will continue to bottom out and stage recovery in the next few quarters, thereby presenting a good risk-return proposition for investors,” Yesh Nadkarni, MD, …

Fresh crisis looms for NBFCs after fund shuts
4 years, 8 months ago

Fresh crisis looms for NBFCs after fund shuts

Live Mint  

India’s shadow lenders are facing fresh turmoil after asset manager Franklin Templeton shut funds late last month, prompting other large investors to dump the financiers’ debt. Three other gauges of the sector’s health compiled by Bloomberg showed no improvement last month, with a measure of shares of 20 financial firms and other companies staying depressed. Government measures To help cash-starved …

RBI ensures liquidity support to NBFCs
4 years, 8 months ago

RBI ensures liquidity support to NBFCs

The Hindu  

The Reserve Bank of India has announced a host of measures to provide liquidity support to the non-banking finance companies, apart from giving them certain benefits for loans extended to the commercial real estate sector. To begin with, the banking regulator said banks to have to invest the funds availed under targeted long term repo operations, in investment grade bonds, …

Drop in borrowing costs shows India NBFC crisis may ease
4 years, 11 months ago

Drop in borrowing costs shows India NBFC crisis may ease

Live Mint  

Borrowing costs for India’s top-rated shadow financiers declined last month, indicating that the nation’s prolonged credit crisis may be seeing some improvement. Premiums that investors seek to buy AAA rated five-year bonds of non-bank lenders over government notes with similar maturities narrowed to a 16-month low in January, helping a gauge measuring bond spreads to strengthen. Supporting these financiers is …

Banks to face capital shortfall of Rs 3.5 lakh cr in event of systemic crisis in NBFC sector: Fitch Ratings
5 years, 2 months ago

Banks to face capital shortfall of Rs 3.5 lakh cr in event of systemic crisis in NBFC sector: Fitch Ratings

Firstpost  

New Delhi: Banks would face a capital shortfall of about $50 billion in the event of a systemic crisis in the non-banking financial company sector, according to a study by global rating agency Fitch. “The credit profiles of the state-owned banks would come under significant pressure, and the weakest – including those with Viability Ratings in the ‘b’ range – …

Realty bites: Indian property slump leaves beleaguered banks exposed
5 years, 3 months ago

Realty bites: Indian property slump leaves beleaguered banks exposed

Live Mint  

India might have thought the worst of a bad loans crisis was past, but a severe cash crunch in the real estate industry could augur fresh strife for its banks. If three-quarters of the high-risk category of outstanding real estate loans is not repaid, that could lead to additional bad debt of $15 billion on banks' books in the next …

Indiabulls Housing Finance shares plunge after merger setback
5 years, 3 months ago

Indiabulls Housing Finance shares plunge after merger setback

Live Mint  

Indiabulls Housing Finance Ltd. plunged on Thursday, as the rebuff to its plan to merge with Lakshmi Vilas Bank Ltd. put a dent in hopes that shadow lenders could use such combinations to get better access to liquidity. The Reserve Bank of India rejected the merger plan, Chennai-based Lakshmi Vilas said in an exchange filing late Wednesday, without disclosing the …

NBFC stocks tumble, DHFL drops nearly 8%
5 years, 3 months ago

NBFC stocks tumble, DHFL drops nearly 8%

Live Mint  

Shares of non-banking financial companies, including DHFL, took a beating on Monday as investors continued to remain concerned about the liquidity crunch in the sector. Among others, stocks of Indiabulls Housing Finance, Indiabulls Ventures, Piramal Enterprises and Edelweiss Financial Services also closed in the red. Indiabulls Housing Finance stock too took a beating, shedding as much as 13.22% to touch …

Investors take shelter in HDFC Bank, Kotak Bank as NBFC woes quake banks
5 years, 3 months ago

Investors take shelter in HDFC Bank, Kotak Bank as NBFC woes quake banks

Live Mint  

Indian banks have faced rough weather in the past two weeks and investors are rediscovering stocks that act as lifeboats in choppy waters. Just three months ago, the combined value of the two banks was about 10% lower than the other 10 lenders, which include State Bank of India, ICICI Bank Ltd, Axis Bank Ltd and seven of the remaining …

NBFC crisis may return to haunt Indian stock markets
5 years, 3 months ago

NBFC crisis may return to haunt Indian stock markets

Live Mint  

India’s shadow banking crisis has sucked in more financial firms this week, eroding a stock market rally that’s been driven by a surprise $20 billion tax cut package. Debt concerns at lenders including Indiabulls Housing Finance Ltd. and a co-operative bank, and worries a cleanup in corporate debt could be prolonged, have spooked the financial markets. The Reserve Bank of …

Central bank opens liquidity tap to help stressed shadow banks
5 years, 5 months ago

Central bank opens liquidity tap to help stressed shadow banks

Live Mint  

The Reserve Bank of India on Wednesday announced two key measures to help stressed non-banking financial companies raise funds from banks. “Under the revised guidelines on large exposure framework that came into effect from 1 April 2019, a bank’s exposure to a single NBFC is restricted to 15% of its Tier I capital, while for entities in the other sectors, …

NBFC crisis: Liquidity steps for non-banking finance companies too little, too short-term, says Fitch report
5 years, 5 months ago

NBFC crisis: Liquidity steps for non-banking finance companies too little, too short-term, says Fitch report

Firstpost  

Mumbai: The government measures to provide partial credit guarantee to public sector bank on their asset purchases from NBFCs can ease funding pressure only for the short-term, says a report. In the budget, the government had said for purchase of high-rated pooled assets of financially-sound NBFCs, amounting to Rs 1 trillion during the current financial year, it will provide a …

DHFL demise imminent just like debt-ridden IL&FS: India’s regulators, raters failed to catch early signs of NBFC mess
5 years, 6 months ago

DHFL demise imminent just like debt-ridden IL&FS: India’s regulators, raters failed to catch early signs of NBFC mess

Firstpost  

In the case of both IL&FS and DHFL, rating agencies stepped in the last minute to call out the nature of stress in these firms and warn investors Dewan Housing Finance Ltd or DHFL—a well-known home loan lender in the country—fears that its days are numbered. DHFL’s near-death and the IL&FS crisis that preceded it exposes the weakness of India’s …

To solve the liquidity crisis, RBI should make banks lend more to NBFCs
5 years, 6 months ago

To solve the liquidity crisis, RBI should make banks lend more to NBFCs

Hindustan Times  

In the immediate liquidity crisis, good Non-Bank Financial Companies should be able to raise debt capital, but this is not always happening. If the real estate company is itself under financial stress, and does not have the money to complete its project, the assets on the balance sheet of the NBFC start looking bad. Suppose the real estate company needed …

Towards a meltdown
5 years, 6 months ago

Towards a meltdown

The Hindu  

INDIA'S ’s financial sector is in the midst of a second crisis, even as the first in the form of a humongous mass of non-performing assets on the books of commercial banks remains unresolved. To others, IL&FS featured only as a company in which a set of high-profile executives and their collaborators, who overborrowed through a complex web of companies …

RBI proposes new liquidity norms for NBFCs. How it may impact you
5 years, 7 months ago

RBI proposes new liquidity norms for NBFCs. How it may impact you

Live Mint  

The Reserve Bank of India has issued draft guidelines on liquidity management for the non banking finance companies and proposed a liquidity coverage ratio for large NBFCs covering all deposit-taking NBFCs and non-deposit taking NBFCs with an asset size of ₹5,000 crore and above. Here is a look at what it means and how it will impact you: THE NEW …

DHFL shares fall nearly 4% amid reports of lookout notice against promoters
5 years, 7 months ago

DHFL shares fall nearly 4% amid reports of lookout notice against promoters

Firstpost  

New Delhi: Shares of Dewan Housing Finance Corporation Ltd fell nearly 4 percent on Tuesday, amid reports of a lookout notice against the company’s promoters over shell companies. On the National Stock Exchange, shares fell by 3.65 percent to close at Rs 114.80 apiece. The BSE had sought clarification from Dewan Housing Finance Corporation Ltd on 28 May, 2019, with …

Delhi NCR real estate market hit by NBFC liquidity crisis, Bengaluru thrives
5 years, 11 months ago

Delhi NCR real estate market hit by NBFC liquidity crisis, Bengaluru thrives

Live Mint  

Bengaluru: The NBFC liquidity crisis has impacted some real estate markets more than others, delaying the possibility of an early recovery. For instance, non-banking financial companies, or NBFCs, have been a key source of funding for builders in Delhi NCR, India’s largest property market, but given the slow sales, developers are finding it tough to maintain the pace of construction, …

NBFC crisis batters realty, home sales grow just 6% in 2018
6 years ago

NBFC crisis batters realty, home sales grow just 6% in 2018

Live Mint  

Mumbai: Real estate developers in 2018 shook off the previous year’s lethargy with 76% higher home launches, even as sales grew at a more sedate 6%, as a cash crunch in the latter part of the year crimped a sustained recovery. The surge in home launches—1,82,207 units across eight cites including Mumbai, Bengaluru and the National Capital Region —came after …

Long shadow of liquidity crunch looms over NBFCs in 2019
6 years ago

Long shadow of liquidity crunch looms over NBFCs in 2019

Live Mint  

What could have been the best year in terms of performance for non-banking financial companies quickly turned sour in just a few weeks in September. Investors have taken note of the impact on business growth and most NBFCs are likely to see modest credit growth, lower than previous expectations, as conserving liquidity and capital will take priority. Housing finance companies …

NBFC, HFC heads meet Narendra Modi over liquidity issues
6 years ago

NBFC, HFC heads meet Narendra Modi over liquidity issues

Live Mint  

New Delhi: Representatives from NBFCs and housing finance companies Wednesday met Prime Minister Narendra Modi here and gave suggestions on how to “revive” the sector facing liquidity issues, especially after debt defaults by crisis-hit IL&FS. IL&FS group has defaulted on a series of debt repayments, raising concerns that default by a large non-banking finance company like IL&FS would create liquidity …

NBFC-led India liquidity crisis may nip green shoots in real estate
6 years, 1 month ago

NBFC-led India liquidity crisis may nip green shoots in real estate

Live Mint  

The liquidity crisis faced by non-banking financial companies has triggered concerns for property developers. After all, commercial real estate and housing sectors comprise nearly two-fifths of the total NBFC portfolio. After banks trimmed their lending to the real estate sector in the past couple of years, developers received nearly half of their funding from NBFCs. Motilal Oswal Financial Services Ltd …

Opinion: NBFCs may need to suffer some pain
6 years, 2 months ago

Opinion: NBFCs may need to suffer some pain

Live Mint  

In India, crises move slowly. The country’s shadow banking sector -- dominated by what officials call “non-banking financial corporations” or NBFCs -- faces something of a reckoning over the next month. What’s more problematic, perhaps, is the government’s insistence that the Reserve Bank of India open up a special window to lend money to the sector as it has for …

Govt says some NBFCs face liquidity stress, puts pressure on RBI to ease
6 years, 2 months ago

Govt says some NBFCs face liquidity stress, puts pressure on RBI to ease

Live Mint  

New Delhi: A top Indian government official on Monday said the nation’s non-banking housing finance companies were facing liquidity stress, in comments that are likely to put more pressure on the Indian central bank to ease its policy towards the sector. The intervention by Corporate Affairs Secretary Injeti Srinivas came after Finance Minister Arun Jaitley and other government officials raised …

Bank aversion to NBFCs fuelled India’s liquidity crisis
6 years, 2 months ago

Bank aversion to NBFCs fuelled India’s liquidity crisis

Live Mint  

Mumbai: The liquidity crisis, which has become a bone of contention between the Reserve Bank of India and the government, has its roots in banks’ reluctance to lend to non-banking financial companies, according to bankers Mint spoke with. According to the chief financial officer of a leading public sector bank, lenders are wary of lending to certain NBFCs because of …

Sensex falls to seven-month low on sell-off in global equities amid concerns about slowdown in world economy
6 years, 2 months ago

Sensex falls to seven-month low on sell-off in global equities amid concerns about slowdown in world economy

Firstpost  

Asian shares plunged after tech stocks caused the largest daily decline on Wall Street since 2011 in the previous session, wiping out all its gains for the year Shares fell nearly 1.5 percent to a seven-month low on Thursday, joining a sell-off in global equities amid concerns about a slowdown in the world economy. Asian shares plunged after tech stocks …

Imminent NBFC slowdown could lead to credit crunch
6 years, 2 months ago

Imminent NBFC slowdown could lead to credit crunch

Live Mint  

Mumbai: The imminent slowdown in credit growth of non-banking financial companies could lead to a credit crunch in India, with overall system credit growth falling to less than 10%, Credit Suisse said in a report. Even as bank credit growth in the last two years has averaged at 7%, a strong 20%+ growth in NBFC credit aided overall credit expansion …

Banks turned wary of NBFCs months before IL&FS defaults
6 years, 3 months ago

Banks turned wary of NBFCs months before IL&FS defaults

Live Mint  

Indian banks seem to have turned wary of non-banking financial companies months before doubts on their liquidity position began to scare investors. The adjoining chart shows that bank loans to NBFCs fell by ₹ 6,000 crore during April-August. The series of defaults by Infrastructure Leasing and Financial Services Ltd over the last two months had hurt sentiments towards NBFCs, as …

NBFC sector likely to face shake-up after IL&FS default
6 years, 3 months ago

NBFC sector likely to face shake-up after IL&FS default

Live Mint  

New Delhi: India’s burgeoning shadow finance sector is likely to face a shake-up after defaults at one major lender battered the nation’s financial markets in the past week and reinforced worries about credit risk. “The way things are unfolding, there is certainly cause for concern and the sector could see consolidation,” said Harun Rashid Khan, a former deputy governor at …

Sebi says no advisory issued to MFs against rollover of exposure to Indiabulls, DHFL
6 years, 3 months ago

Sebi says no advisory issued to MFs against rollover of exposure to Indiabulls, DHFL

Firstpost  

The clarification follows Sebi seeking details from mutual funds about their exposure to all NBFCs and housing finance companies, amid concerns over liquidity in the system, according to sources. New Delhi: Capital market regulator Sebi on Friday said it has not issued any advisory to mutual funds against rolling over of their current exposure to Indiabulls Housing Finance and Dewan …

NBFC, housing finance stocks continue to slide on worries over liquidity constraints
6 years, 3 months ago

NBFC, housing finance stocks continue to slide on worries over liquidity constraints

Firstpost  

Shares of housing finance and NBFC companies had dropped as much as 23.5 percent on Tuesday, led by DHFL, on fears of a liquidity crisis. New Delhi: Shares of NBFC and housing finance firms continued to trade weak Thursday, plunging by up to 8.5 percent on worries over liquidity constraints. Can Fin Homes plunged 8.48 percent, PNB Housing Finance 7.29 …

IL&FS, DHFL shocks may be temporary triggers, but the bad news for Indian financial markets do not end there
6 years, 3 months ago

IL&FS, DHFL shocks may be temporary triggers, but the bad news for Indian financial markets do not end there

Firstpost  

The joint entry of the central government, regulators and the country’s top bank to the scene to calm the choppy markets post the IL&FS scare itself is a proof that there is more that meets the eye and it is not just rumour-mongering. According to Moody’s Investor Services, the firm’s outstanding debentures and commercial paper accounted for one percent and …

NBFCs lose over ₹ 75,000 crore in 2 sessions on liquidity fears
6 years, 3 months ago

NBFCs lose over ₹ 75,000 crore in 2 sessions on liquidity fears

Live Mint  

Mumbai: India’s top 15 non-banking finance companies have together lost over ₹ 75,000 crore in the last two trading sessions on fears of a financial crunch in the sector. Across Friday and Monday, Housing Development and Finance Corp. Ltd lost around ₹ 18,600 crore, Bajaj Finance Ltd around ₹ 13,800 crore and Bajaj Finserv Ltd ₹ 4,200 crore. The other …

Jaitley assures on liquidity to mutual funds, NBFCs
6 years, 3 months ago

Jaitley assures on liquidity to mutual funds, NBFCs

Live Mint  

The government will take all measures to ensure that adequate liquidity is provided to the NBFCs, the mutual funds and the SMEs, tweeted Finance Minister Arun Jaitley on Monday, reassuring the markets after stock and bond markets were rattled on Friday on concerns over defaults by IL&FS and fears of liquidity tightness in the financial system. India’s banking and markets …

Friday mayhem exposes chinks in non-banking financial firms’ armour
6 years, 3 months ago

Friday mayhem exposes chinks in non-banking financial firms’ armour

Live Mint  

Blame it on their funding model. Relying on the wholesale market for funds, non-banking financial companies are easily susceptible to liquidity disruptions in the money markets. A 17 September report by India Ratings & Research pointed out, “Liquidity Shocks could result in Refinancing Challenges: While most of the NBFCs have opted for matching assets to liabilities, some of the large …

No concern on liquidity of NBFCs: SBI chairman Rajnish Kumar
6 years, 3 months ago

No concern on liquidity of NBFCs: SBI chairman Rajnish Kumar

Live Mint  

New Delhi: Assuring lending support to non-banking financial companies, SBI Chairman Rajnish Kumar on Sunday said there was no concern on liquidity of such firms, amid ongoing debt crisis in IL&FS Group. Shares of housing finance companies came under sudden heavy selling pressure on Friday as investors raised concerns over rising cost of borrowing for the companies amid crisis at …

Shares of housing finance firms crash sharply; DHFL tumbles 42% on massive selling over fears of a liquidity crisis
6 years, 3 months ago

Shares of housing finance firms crash sharply; DHFL tumbles 42% on massive selling over fears of a liquidity crisis

Firstpost  

New Delhi: Shares of housing finance firms came crashing sharply Friday, with Dewan Housing Finance tumbling up to 42 percent on massive selling over fears of a liquidity crisis, which had a cascading effect on the broader market as well. The scrip of Dewan Housing Finance Corporation went into a tailspin, nosediving 42.43 percent to end at Rs 351.55 on …

Sensex recovers 900 points after slipping by 1100 in afternoon trade; Nifty reclaims 11,100
6 years, 3 months ago

Sensex recovers 900 points after slipping by 1100 in afternoon trade; Nifty reclaims 11,100

ABP News  

Key Indian equity indices slumped on Friday afternoon with BSE Sensex losing over 1,100 points following a sharp fall in housing finance stocks. According to news agency PTI, the broader NSE Nifty cracked below the 11,000 mark, falling 367.90 points, or 3.27 per cent, to touch a low of 10,866.45, before recovering over 300 points to trade near 11,169.90. Yes …

DHFL shares slump 42% on default rumour, drag housing finance stocks as well
6 years, 3 months ago

DHFL shares slump 42% on default rumour, drag housing finance stocks as well

Live Mint  

Mumbai: Shares of housing finance companies came under sharp selling pressure on Friday after Dewan Housing Finance Ltd slumped nearly 60% in afternoon trade today, dragging down other home finance companies as well. Indiabulls Housing Finance Ltd slumped 23%, Gruh Finance 15%, LIC Housing Finance Ltd 15% and L&T Housing Finance Ltd 12%. The real estate market has been under …

Closing bell: Sensex closes 280 points lower after 1,500-point swing on DHFL default scare
6 years, 3 months ago

Closing bell: Sensex closes 280 points lower after 1,500-point swing on DHFL default scare

Live Mint  

OTHERS :Mumbai: The BSE Sensex and the NSE Nifty 50 closed lower for the fourth straight session on Friday, dragged mainly by finance stocks. Energy and oil and gas gained 0.77% and 1.50%, respectively.ONGC, Wipro, ITC, BPCL and IOC were among the top gainers, whereas Yes Bank, Indiabulls Housing Finance, Kotak Bank, Bajaj Finance and Adani Ports were among the …

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