Sakshi Batra does a 3 Point Analysis on the current funding situation, its likely impact on growth, asset quality and profitability of housing finance companies.
The Department of Economic Affairs (DEA) fears a “significant default” from large non-banking finance companies (NBFCs) and housing finance companies (HFCs) in the next 6 weeks if additional liquidity support is not forthcoming.
Source and cost of funding are vital for NBFCs. While the cost is going up, there seems to be some pressure on source of funds at the moment.
Sakshi Batra is in conversation with Santosh Nair, Editor of Moneycontrol, to find out what’s worrying investors, and how the markets could fare in the coming weeks.
Even as near-term outlook remains cloudy for housing finance companies, some stocks deserve a closer look.
Most of this incremental capital requirement would be for the small HFCs, including those operating in affordable housing space, it said.
According to a Crisil report, new pure-play affordable home loan players have seen their assets under management jumping 50 per cent to Rs 23,000 crore as of March 2017, from Rs 15,000 crore in March 2016.
The whole world might be worried about IT and pharma amid regulatory hurdles as well as rising rupee but fundamentally they remain a strong play, Sheth told CNBC-TV18.
Going by the buzz on D-Street, we have collated a list of top ten sectors from various experts which are likely to remain in the spotlight in FY2018.
Credit growth for the PSU banks is expected to be weak for the next fiscal year not only because of their limited ability to lend money but also because the capex demand is completely absent, said Suresh Ganapathy, Banking Analyst, Macquarie Cap Sec.
Housing finance companies (HFCs) are elated with the Securities and Exchange Board of India‘s move to hike the investment limit for debt mutual funds to 15% from 10% earlier.
Debt mutual funds were allowed to have an exposure of only up to 10 percent to housing finance companies. This has been increased to 15 percent with the immediate effect subject to certain conditions.
Debt mutual funds can now invest up to 15 percent of their total net assets in housing finance companies with Sebi easing the regulations in this regard.
In a bid to push the housing and real estate sector, the Union Budget 2017-18 granted infrastructure status to the affordable housing sector thereby making higher capital available for developers and financial institutions to push the latent demand for housing.
With banks reducing their interest rates, housing finance companies business is likely to be affected and they will be forced to realign their strategies, says a report.
Many home buyers favour taking loans from housing finance companies (HFCs) as stamp duty and registration costs are included while calculating the total costs of the property as compared to only basic property rates for banks.
Basis of home loan interest rates charged by housing finance companies Housing finance companies (HFCs) are regulated by the National Housing Bank Limited (NHB), a subsidiary of the RBI. The funding of housing finance R
Investors might be caught off-guard as spill-over of liquidity from a rampant bull market overseas could lead to big market move here, feels N Jayakumar of Prime Securities. Patient investors will certainly get good returns, he says.
we cut our long-standing overweight on consumer staples and deepen our underweight on IT and healthcare. We stay overweight on discretionary but two-wheelers may hurt, says Neelkanth Mishra of Credit Suisse.
Additional 5 percent allowed for funds to invest in housing finance companies in the paper will see demand from bond market, SK Hota, Managing Director of Can Fin Homes told CNBC-TV18. There‘ll be a cost advantange to companies like ours, he said, adding, that he expects liquidity to increase which will help faster growth in loan book.
NBFCs, including housing finance companies (HFCs), have been diversifying their funding sources as a way to reduce their dependence on financing from banks.
The Securities and Exchange Board of India said on Wednesday that debt mutual funds can now invest an additional 10 percent in housing finance companies above the 25 percent sectoral limit.
"Given the government's focus on housing finance sector and the crucial role played by HFCs within this sector, SEBI's guidelines to mutual funds to reduce the additional exposure limit provided to housing finance companies came to us as a surprise.
Funds received on account of arrears payouts can be used to partly finance home purchases, V Raghu of Repco Home Finance tells CNBC-TV18.
Raamdeo Agarwal, Motilal Oswal, says 1 percent infra cess on cars will not be a big dampener for auto companies.