Latest news with #SureshGanapathy
Time of India
6 days ago
- Business
- Time of India
RBI eyes bank-like rate norms for NBFCs to plug policy gaps
RBI MUMBAI: RBI is looking to introduce interest rate rules for non-banking finance companies similar to those that govern banks. The goal is to improve how changes in monetary policy pass through to borrowers and to make loan pricing more transparent. As of now, when RBI changes its benchmark repo rate, banks pass on the changes quickly to borrowers with floating-rate loans. However, NBFCs, including housing finance firms, adjust more slowly or in ways that are less transparent. "The extant regulations on interest rates on advances vary across all regulated entities," said RBI. "In order to harmonise the same, a comprehensive review of the extant regulatory instructions is underway. " RBI has been consulting internally and with key industry stakeholders about how to standardise interest rate frameworks. "In order to solicit wider public feedback, it is proposed to issue a discussion paper delineating the various imperatives of moving to a harmonised regime for interest rates on loans and advances across all regulated entities," the central bank said in its annual report. Analysts say the current system creates gaps in oversight. "Banks have repo rate-linked loans, MCLR (marginal cost of lending rate) loans, etc, which are all well defined and RBI can track how transmission happens," said Suresh Ganapathy of Macquarie. "NBFCs don't have these repo-linked or MCLR loans and they price their loans off some antiquated PLR (prime lending rate) concept. Of course, eventual end-pricing will be determined by competitive forces. Having said that, this entire process is super opaque and hence it is essential a proper alignment is sought," Ganapathy added. RBI also wants to overhaul how it supervises NBFCs broadly. One change involves reviewing its risk-based approach to monitoring compliance with anti-money laundering rules. It will examine whether KYC framework is being applied effectively, especially for higher-risk firms. The regulator also plans a thematic review to ensure NBFCs follow interest rate guidelines, particularly to prevent customers from being charged excessive rates. At the same time, it is studying how to bring more NBFCs under a risk-based supervision model, where regulatory attention depends on the complexity and risk profile of each firm. RBI also plans to simplify rules for borrowing and lending in rupees, and to streamline the process by which companies are authorised to handle foreign currency under India's foreign exchange law. Stay informed with the latest business news, updates on bank holidays and public holidays . AI Masterclass for Students. Upskill Young Ones Today!– Join Now
Mint
21-04-2025
- Business
- Mint
F&O Strategy: Eternal to Torrent Pharma— Rupak De suggests buy or sell strategy for THESE stocks
Stock market today: The key domestic indices, Nifty 50 and Sensex, were on track for their fifth consecutive day of increases on Monday, supported by a weaker US dollar and a rise in bank stocks within the country. As of 13:10 IST, the Nifty 50 rose by 1.40% to reach 24,186.25, while the Sensex climbed 1.36% to reach 79,622.30. Both indices reached their highest values since January 6. Following strong earnings reports, ICICI Bank and HDFC Bank, the top two stocks on the Nifty 50, jumped by 0.9% and 1.3%, respectively, achieving record highs. Suresh Ganapathy, managing director and head of financial services research at Macquarie Capital, noted that financials are seen as a clear consensus overweight, especially since they underperformed in the last market rally cycle, and their current valuations are quite appealing, according to a Reuters report. Moreover, foreign investments are on the rise, with the anticipation that financials will be less affected by US tariffs, he added. On the derivatives front, technical analysts, observed a blend of long build-up and short covering in both key indices over the week. The Long-Short Ratio rose from 25% to 30% week-on-week. With strong buying witnessed in Thursday's session, a follow-through move towards 24,000 appears likely, while dips around 23,600–23,700 may present opportunities to add fresh longs. FIIs were net buyers in the cash market segment, buying stocks worth ₹ 4,667 crore. In the Index futures segment, they were net buyers worth ₹ 439 crores with a rise in OI, indicating long formation. The index witnessed an impressive rally, with the Nifty closing above its previous swing high (on a closing basis). This sharp upward move has propelled the index above the 100-day EMA on the daily chart, indicating a strengthening midterm bullish trend. In the near term, the momentum is likely to continue, with the Nifty eyeing a potential move towards 24,100. A decisive break above this level could pave the way for an advance towards 24,500. On the downside, immediate support is seen at 23,650, followed by 23,300. Open Interest Analysis: Significant open interest additions were observed in both the 23,850 Puts and Calls. Call writing was relatively muted on Friday, with the highest OI buildup seen at the 24,200 CE. Meanwhile, substantial put writing at the 23,500 strike indicates strong support around that level. Strategy: Sentiment is likely to remain strong unless it falls below 23,500. Trade: Buy Nifty 50 24 Apr 24,000CE Above 130 TGT 180 SL 100. The Eternal share price has given a breakout from a falling wedge pattern, indicating a potential shift in momentum from downtrend to uptrend. Adding strength to this breakout, the price has successfully moved above the 50-day Exponential Moving Average (EMA), signalling growing bullish sentiment and improved price stability. Additionally, the Relative Strength Index (RSI) has exhibited a bullish crossover, further reinforcing the positive momentum. In the short term, the trend is likely to continue towards higher levels. On the upside, the stock may move towards ₹ 250, while support is placed at ₹ 219. A break below this level could lead to weakness. IOC share price has recently given a consolidation breakout on the weekly chart, suggesting a growing buying interest and a shift in market sentiment toward optimism. Additionally, the price has closed above the critical 100-week EMA (exponential moving average), confirming a strong trend. The momentum indicator RSI is also showing a bullish crossover. In the short term, the trend is likely to continue towards higher levels. On the upside, the stock may move towards ₹ 144, while support is placed at ₹ 129. In the last few days the stock has been sustaining above the critical moving average on the daily chart, suggesting an ongoing momentum. Besides, the price moved above the 200DMA, suggesting a change in the medium term trend in the price. The RSI is in bullish crossover and rising. In the short term, the trend is likely to continue towards higher levels. On the upside, the stock may move towards ₹ 3,500, while support is placed at ₹ 3,187. Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions. First Published: 21 Apr 2025, 01:30 PM IST
Reuters
15-04-2025
- Business
- Reuters
India's HDFC Bank hits four-month high as deposit rate cut seen lifting margins
April 15 (Reuters) - Shares of India's HDFC Bank ( opens new tab rose as much as 4% on Tuesday to 1,876.80 rupees and were set for their best day in 10 months, after its deposit rate cuts were seen as a margin boost amid slowing loan growth in the industry. India's largest private lender rose to 1,876.80 rupees as of 8:53 a.m. GMT, its highest since early December, after the bank cut, opens new tab savings deposit rates by 25 basis points across tiers - its first cut in the under-5-million-rupee ($58,263) category in five years. Brokerage Macquarie said the rate cut could boost HDFC Bank's margins by five basis points starting the first quarter of fiscal 2026, while Jefferies estimated it would reduce costs on 23% of its deposits. "HDFC Bank already had room to cut... We expect more banks to cut savings deposit rates in coming quarters," Macquarie analyst Suresh Ganapathy said. Jefferies added that private banks may cut rates faster compared to state-run lenders. Nifty private bank index (.NIFPVTBNK), opens new tab has added nearly 3% on the day, in its best session since early June. ($1 = 85.8175 Indian rupees)
Reuters
27-02-2025
- Business
- Reuters
India's financial stocks jump as central bank further eases strict lending rules
Feb 27 (Reuters) - Shares of most Indian financial companies, especially those of non-bank and microfinance-focussed lenders, jumped on Wednesday after the central bank further eased its capital requirements for micro loans and bank credit. Financial stocks (.NIFTYFIN), opens new tab, which include non-bank finance companies (NBFCs), jumped about 1%, outpacing the 0.7% increase in banking stocks (.NSEBANK), opens new tab. The benchmark Nifty 50 (.NSEI), opens new tab, in comparison, was flat. The Reserve Bank of India, on Tuesday, trimmed the higher capital requirements introduced in November, the latest in a series of growth-supportive measures since Sanjay Malhotra took over as governor in December. Under his watch, the RBI has eased liquidity, delayed some regulations and loosened restrictions placed on some lenders. "We think this bodes well for the financial sector and lays more emphasis on consumption and growth ... and (we) reiterate our bullish view," Macquarie analyst Suresh Ganapathy said in a note. On the day, Bandhan Bank ( opens new tab gained 6%, while Shriram Finance ( opens new tab, AU Small Finance Bank ( opens new tab and Ujjivan Small Finance Bank ( opens new tab rose about 5% each. Cholamandalam Investment and Finance ( opens new tab and Aditya Birla Capital ( opens new tab advanced 4.5% each. Bajaj Finance ( opens new tab rose 2.7% and IndusInd Bank ( opens new tab gained 2%. In comparison, top private lenders such as ICICI Bank ( opens new tab and HDFC Bank ( opens new tab were up under 1%. The RBI's move should help most NBFCs' earnings, Morgan Stanley analysts said, picking Aditya Birla Capital, PNB Housing, Shriram Finance and Bajaj Finance as top beneficiaries. Nomura analysts said banks with higher microfinance loan exposure, such as Bandhan Bank, IndusInd and AU Small Finance Bank, would also get much needed relief. Since the rules were implemented in November, Aditya Birla Capital's shares had slid 16%, while AU Small Finance Bank and IndusInd Bank sank 28% and 31%, respectively. The worst hit, with a 38% tumble, was Bandhan Bank -- the day's top gainer. However, Axis Bank Chief Economist Neelkanth Mishra cautioned that a reversal in the broad-based slide in loan growth -- caused by high liquidity costs and the RBI's discomfort with high loan-to-deposit ratios -- could take time. "While these (RBI) signals should help revive lending, we believe the binding constraint remains durable liquidity."
