PERSONAL BUSINESS LOANS
L&T Finance Q1 Results: Cons PAT jumps 29% YoY to Rs 686 crore
NBFC firm L&T Finance on Tuesday reported a 29 per cent rise in consolidated net profit to Rs 686 crore for the first quarter ended June 2024 on the back of healthy interest income. The non-banking financial company had posted a net profit of Rs 531 crore in the same quarter in the previous fiscal.
Staying with quality pays in long term wealth creation: 5 midcap stocks from different sectors with potential upside of up to 35%
If looking for investing in a bank, which would be better stock to own. A bank which after a period of four years has once again paid dividend last year or a bank, which in the last five years have missed dividend only in FY 2020, which was covid year. Yes, second one, but most investors don't look at these things which in the long run matter both for the real business and finally the stock price. Similarly, there are many small things which need to be looked at when investing in a mid cap stocks for very simple reason that market is sitting with a good amount of gain and short corrective move which may come largely because of global reason or just a simple profit booking move may hit midcap more than anyone else. So, while being bullish and increasing your exposure just do a little bit of work so that one is able to avoid anxiety in time of corrective phase of the market.
Stock picks of the week: 5 stocks with consistent score improvement and upside potential of up to 41%
As the nifty and sensex continue to touch new highs with just minor corrective mode, it is bulls who are in control of every corner of the street. In such conditions, the decision to hold the current stocks is probably an easy one. The more difficult decision is which sectors and stocks which one should look at if one is investing fresh money at this point of time. For that rather look at what is happening to stock prices, look at what is happening in the underlying business. Because finally it is the real business which matters and in a bullish market sectors which are witnessing real positive change are likely to perform better. So look at stocks where analysts' outlook has improved over the last one month. These selected stocks depict a strong upward trajectory in their overall average score which is based on five key pillars i.e. earnings, fundamentals, relative valuation, risk and price momentum. This implies that there has been a significant improvement in their market outlook in the given time frame.
Loan Rates: RBI's new diktat lowers loan costs for you, but banks lose hundreds of crores
On April 29, the banking regulator directed all lenders to charge interest from the date of actual disbursement of the funds to the customer after its annual inspection revealed instances of lenders resorting to unfair practices in charging of interest. "Earlier, lenders were taking about 30-45 days to consummate a loan agreement, and they were freely charging interest rate during the period without the actual amount being disbursed to the customer," the CEO of a housing finance company said on the condition of anonymity.
Paytm Bank, auditor lock horns over business viability
Paytm Payments Bank faces audit qualification disputes over viability, seeking RBI intervention. Compliance issues led to operational restrictions, prompting directions to transfer businesses. KYC guideline non-compliance has halted income generation and eroded net worth.
ONGC Videsh to raise USD 800 million from 3 banks
The pricing of the loan could change depending on the level of interest from other participating banks, a second person said. At 120 basis points above the three-month SOFR rate, which is currently trading at about 5.30%, the loan could be priced at about 6.50%. One basis point is 0.01 percentage point.
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Coffee Day Enterprises' total default at Rs 433.91 crore in Q1 FY25
Coffee Day Enterprises Ltd (CDEL) reported a total default of Rs 433.91 crore on interest and principal payments to banks, financial institutions, and holders of unlisted debt securities like NCDs and NCRPS for the quarter ending June 30, 2024. The company attributed the delay in debt servicing to a liquidity crisis. CDEL noted that the default amount remained unchanged from previous quarters due to the company not recognizing interest since April 2021. Lenders have issued loan recall notices and initiated legal proceedings against CDEL.
ONDC to add banks, fintechs to take credit services to last mile
The homegrown Open Network for Digital Commerce (ONDC) will soon integrate banks such as HDFC Bank, IDFC First Bank and Karnataka Bank, alongside fintech companies like Fibe, sources told us. This comes as the network began early pilots for credit disbursal through its platform, by partnering with Tata Group superapp Tata Neu and Paisabazaar.
IBC helps personal guarantors resolve financial stress: MCA
The Insolvency and Bankruptcy Code (IBC) provides opportunities for defaulting firms and personal guarantors to restructure debts. The Ministry of Corporate Affairs (MCA) emphasized the importance of trust in financial transactions and highlighted the benefits of the IBC for resolving financial difficulties. Data from the Insolvency and Bankruptcy Board of India (IBBI) shows a high number of applications for the insolvency resolution process of personal guarantors to corporate debtors.
Sonakshi Sinha's to-be father-in-law was Salman Khan's 'personal bank,' gave loans to 'Dabangg' star
Iqbal Ratansi is a multifaceted businessman based in Mumbai, known for his ventures in real estate, entertainment, and jewelry. He is also renowned for his close friendship with Bollywood superstar Salman Khan, dating back to the 1980s. Ratansi's diverse business portfolio includes companies like Stelmac Developers and Zahero Media, showcasing his adaptability and foresight in navigating changing markets.
Power Finance Corporation board okays Rs 15,000 crore loan to Shapoorji Pallonji Group companies
The board of Power Finance Corporation (PFC), a state-owned entity, has approved a loan of Rs 15,000 crore to companies within the Shapoorji Pallonji group, according to sources familiar with the matter. This decision represents a significant development for the Mistry family, who hold 18.37% stake in Tata Sons. The loan is intended to assist in settling promoter debts and fulfilling financial obligations owed by their operational firms to creditors. Security for the loan will be provided by the cash flows from SP Group's real estate operations and the Mistry family's shares in Tata Sons.
Kinara Capital's resilient model gives it 51% profit rise despite distress in fintech sector
The fintech company has been profitable even when the customer segment was disproportionately impacted, says Hardika Shah, Founder & CEO of Kinara Capital. She says this has happened on the back of a balanced business model and strategic planning.
How tech-first stock brokers are diversifying into lending
Stock broking startups are focusing on consumer loans as they look to diversify their business area. Large stock brokers like Groww and Angel One are disbursing strong numbers for personal and consumer loans. Groww is facilitating disbursement of around Rs 250 crore of personal loans every month, while Angel One is handing out around Rs 50 crore monthly.
Risk weighting slows unsecured loan growth
The growth of unsecured credit in India, including personal loans and credit card outstanding, slowed to 18% in April from 23% in November 2023. The Reserve Bank of India's risk weighting on such exposures aims to reduce delinquencies in the banking system.
Shriram Finance raises USD 468-mn multi-currency social loan
Shriram Finance Limited raised USD 468 million in multi-currency for business growth through a social loan structured by leading banks, marking the largest syndicated transaction by a private NBFC.
Paytm halts postpaid loans, to focus on distribution-only model
Fintech major Paytm's losses widened to Rs 550 crore in the fourth quarter ended March 2024. The same stood at Rs 169 crore in the last year quarter.
Tighter regulations on personal loans and project finance may hurt banks in FY25
Indian banks had a strong fiscal 2024 but face challenges in the current year due to regulatory changes impacting credit growth and net interest margins. Return ratios and riskier lending are also areas of concern as the market adapts.
This banking stock gave 22% returns last year; is Equitas Small Finance Bank stock a good buy now?
Equitas Small Finance Bank’s 2022-23 annual report expects a Rs.22 lakh crore market for small business lending, backed by residential property. A recent Centrum Broking report states that the company is poised to double its AUM within the next three years, supported by its improving deposit franchise and distinct client segments. Its comfortable valuations at 1.4 times based on 2025-26 P/ABV (price to adjusted book value) presents an appealing opportunity for entry, adds the Centrum report. Should you invest in Equitas Small Finance Bank now?
TVS Holdings to acquire 80.74% stake in Home Credit India Finance for Rs 554 crore
TVS Holdings Ltd on Friday said it will acquire 80.74 per cent stake in Home Credit India Finance Pvt Ltd for an aggregate consideration Rs 554.06 crore.
Household savings decline due to rising home, auto, personal loans
Household savings saw a third consecutive decline in FY24, dropping by Rs 9 lakh crore to Rs 14.16 lakh crore by FY23, per MoSPI data. ICRA's Aditi Nayar attributed this to a 73% rise in liabilities during 2022-23. Yet, there's optimism for FY25 as RBI curbs on personal loans may reverse the trend. Chief Economic Advisor Nageswaran highlighted a shift towards real assets.
Paytm shares plummet 5%, hit all-time low as lending partners invoke loan guarantees
Paytm Share Price: Paytm shares plummeted to an all-time low after Aditya Birla Finance invoked loan guarantees due to repayment defaults. Other partners like Piramal Finance and Clix Capital have also terminated their partnerships, reflecting stress in Paytm's lending business amidst regulatory actions and market conditions.
Aditya Birla Finance, others may have invoked Paytm’s loan guarantees
Aditya Birla Finance invoked loan guarantees from Paytm due to defaults. Partnership stress with other lenders. Paytm's lending business faces challenges post central bank's ban. Changes in top management. Reduced consumer loan portfolio to less than 1%.
Co-lending AUM nearing Rs 1 lakh cr, RBI curbs to slow down growth in personal loans
Personal loans occupy a third of the overall AUM at present, and the growth in these loans is likely to be impacted because of the RBI's measures adopted last year, it said. "While co-lending books for all asset classes will grow, the pace of growth for personal loans is expected to be slower than that seen in the recent past," the agency said. The revision in the risk weight of unsecured consumer credit to 125 per cent from 100 per cent earlier will moderate the growth for unsecured loans to 25-35 per cent in FY25 from an estimated growth of 35 per cent in FY24.
Why RBI's disproportionate action against fintechs may be bad for business and investor sentiment?
In a situation where financial liabilities of citizens have grown from 3.8% to 5.8% of GDP between 2021 and 2023, is it not reasonable to expect that regulatory and supervisory actions are taken in a 'calibrated' fashion, keeping an eye on customers credit needs and financial convenience? In an age when gov and corporations promote light-touch digital solutions as a universal panacea, should regulatory boundaries remain static and stifle new lending models?
RBI steps up scrutiny of retail lending, targets top-up home loans
RBI tightens supervision on retail lending, focusing on mortgage top-ups, algo-based credit models, and co-lending. It aims to manage risks in the financial system amid rapid credit expansion and global economic uncertainty. The RBI typically uses moral suasion - speeches, calls to bank executives, individual meetings - as initial steps to prod banks, before considering more assertive enforcement.
Loans to women grow at 19% in 2023; personal loans jump fastest: Report
Loans availed by women in India grew 19% in 2023, outpacing the overall loan growth of 17%. Personal loans and two-wheeler loans portfolios saw the fastest growth at 26%. The overall portfolio to women stood at Rs 30.95 lakh crore in 2023, up from Rs 26 lakh crore at the end of 2022. The growth in women borrowers by active loans was the fastest in the personal loan segment at 52%.
How to differentiate between good debt and bad debt? Harsh Roongta explains
Harsh Roongta advises paying off expensive loans like credit cards or unsecured loans first. Fixed income bearing investments should be used before considering a top up loan on a home loan to pay that off. Fixed deposits can be used to repay loans through linked savings accounts for liquidity and high interest.
RBI cautions banks, NBFCs against complancency
Reserve Bank of India (RBI) governor Shaktikanta Das has asked banks to be on guard against complacency and be vigilent around build-up of risks in the financial sector. Das along with deputy governors M Rajeshwar Rao and Swaminathan J met CEOs of public sector banks on Tuesday, the first such meeting since July last year.
Loans from small time borrowers surge post COVID: Report
The report by CRIF Highmark provides insights into the portfolio at risk across various buckets. It ranges from 0.3% to 2.1% as of June 2023. The report also highlights that delinquency has improved across all individual MSME loans, except for construction equipment loans, where payments are due between 181-360 days. These findings assume significance in understanding the risk and performance of different loan segments.
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