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Time of India
2 days ago
- Business
- Time of India
Non-bank lender stocks surge after RBI policy announcement and relaxed norms boost sector outlook
This is a representative image MUMBAI: Shares of non-bank lenders surged on Monday following the RBI 's policy announcement on June 6, with many NBFC and small finance bank stocks posting sharp gains. The central bank's decision to reduce risk weights on retail loans for well-capitalised NBFCs and its dovish signals on liquidity lifted sentiment across the sector. Capri Global jumped 15.2%, Five Star rose 9.2%, and Edelweiss climbed 8%. IIFL gained 7.5%, Bandhan Bank added 7.1%, and Geojit Financial advanced 6.9%. JM Financial, Arman Financial, and Fedfina were up 6.7%, 6.5%, and 5.9%, respectively. Among small finance banks, ESAF gained 5.8%, Utkarsh 4.6%, and Jana Small Finance 5.7%. RBL Bank added 5.3%, Fusion rose 5.2%, and IREDA was up 5.2%. Wealth and asset managers such as UTI AMC and SMC Global rose 4.3% and 4.4%, respectively, while MCX gained 6.8%. The RBI also relaxed norms for microfinance lenders and small finance banks, further boosting the outlook for the broader sector. For NBFC-MFIs, the qualifying asset criteria were eased, allowing them to diversify up to 40% of their portfolio beyond microloans. This is expected to reduce concentration risk, improve balance sheet resilience, and enhance earnings stability. For small finance banks, lower risk weights on microfinance loans will reduce capital requirements and expand lending capacity. These moves, combined with a supportive macro environment, are expected to aid credit growth and financial inclusion across underserved segments. 'For NBFCs that operate extensively in tier 2 and tier 3 towns, this policy move opens up new momentum for credit-led expansion. The broader implication of this rate cut cycle is significant as it reflects a forward-looking strategy that is aligned with India's vision for inclusive and sustained growth. As highlighted by the RBI Governor, this brings the country a step closer to the goal of Viksit Bharat 2047. With rural resilience and continued expansion in services, both urban and rural consumption are poised to become strong drivers of India's next growth phase,' said Umesh Revankar, Executive Vice Chairman, Shriram Finance. Emkay Global said in a research note, 'The RBI heard the practical challenges of the new gold loan rules and adjusted them accordingly. We see this as a sign of the regulator wanting to remove friction in banks' and NBFCs' ability to lend, as far as possible.' According to Vivek Singh , CEO, Home Credit India, 'The recognition of abating stress in unsecured personal loans and ongoing recalibration efforts reinforces our commitment to robust underwriting and collection practices, supporting a healthier credit environment and India's growth.' George Alexander Muthoot, MD, Muthoot Finance, said, 'For NBFCs, this is an encouraging move as it creates a favourable environment by lowering borrowing costs and extending affordable credit to underserved communities. The move, coupled with a lowered inflation outlook, is likely to support domestic consumption and stimulate credit demand in the coming quarters. Overall, we view this as a timely and positive intervention that can support a stronger credit cycle in FY26. ' Stay informed with the latest business news, updates on bank holidays and public holidays . AI Masterclass for Students. Upskill Young Ones Today!– Join Now
Time of India
2 days ago
- Business
- Time of India
Non bank lender stocks surge after RBI policy announcement and relaxed norms boost sector
Mumbai: Shares of non-bank lenders and small finance institutions rallied on Mon after the RBI announced regulatory easing on Jun 6. The central bank's decision to lower risk weights on certain retail loans and offer liquidity support lifted sentiment across the sector, pushing several stocks to sharp gains. Capri Global rose 19.5% to close at Rs.181.6, leading the pack. Five Star gained 9.5% to Rs.800.6, JM Financial advanced 8.9% to Rs.155.2, and IIFL climbed 8.1% to Rs.487.4. while Edelweiss rose 7.3% to Rs.113.4, and Fedfina rose 7.1% to Rs.111.2. Manappuram increased 6.9% to Rs.264.8, SMC Global rose 6.9% to Rs.126, and Jana Small Finance Bank gained 6.7% to Rs.519.7. Geojit climbed 6.1% to Rs.91.1, Fusion rose 6% to Rs.182.3, and Muthoot Microfin advanced 4.9% to Rs.134.6, while IREDA closed 4.8% higher at Rs.183.3. The RBI also relaxed asset norms for microfinance lenders and small finance banks. NBFC-MFIs can now allocate up to 40% of their portfolio outside traditional microloans, which is expected to reduce concentration risk and strengthen balance sheets. For small finance banks, lower risk weights on microfinance exposures are likely to ease capital requirements and boost lending capacity. According to analysts, these changes, along with a supportive macro backdrop, are set to aid credit growth and financial inclusion, especially in underserved areas. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Eat 1 Teaspoon Every Night, See What Happens A Week Later [Video] getfittoday Undo Umesh Revankar, executive vice chairman of Shriram Finance, said the measures open new momentum for credit expansion in tier 2 and 3 towns. A research note by Emkay Global said the RBI had adjusted its gold loan norms after recognising operational challenges. It added that this reflected the regulator's intent to reduce friction in the lending ability of banks and NBFCs. Vivek Singh, CEO of Home Credit India, acknowledged the RBI's recognition of improving trends in unsecured personal loans. He said this, along with ongoing recalibration efforts, strengthens the industry's commitment to robust underwriting and collections. 'It supports a healthier credit environment and India's growth,' he added. Meanwhile, George Alexander Muthoot, MD of Muthoot Finance, described the policy shift as encouraging for NBFCs. He noted that the move creates a more favourable environment by lowering borrowing costs and enabling greater access to affordable credit in underserved areas. 'Coupled with a lowered inflation outlook,' he said, 'this is likely to support domestic consumption and stimulate credit demand in the coming quarters. ' Muthoot further commented that the RBI's steps represent 'a timely and positive intervention that can support a stronger credit cycle in FY26.' Stay informed with the latest business news, updates on bank holidays and public holidays . AI Masterclass for Students. Upskill Young Ones Today!– Join Now
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Business Standard
25-04-2025
- Business
- Business Standard
Shriram Finance Q4 net profit up 6%, board clears foray into payments biz
Shriram Finance, one of the largest non-banking financial companies in India, on Friday reported a 6 per cent increase in its consolidated net profit to ₹2,143.77 crore in the fourth quarter of the financial year 2024-25 (FY25), compared to ₹2,021.28 crore in the year-ago period. The quarter saw a one-time exceptional gain of ₹1,553.66 crore on account of disinvestment of Shriram Housing Finance. During the period under review, the company's total income also zoomed 21 per cent to ₹11,460.25 crore as against ₹9,497.85 crore during Q4FY24. Shriram Finance also said that the board has approved the plan to foray into the payments business by offering mobile wallets and prepaid cards, as part of its diversification. 'Approved the proposal to offer payment services through mobile wallets, prepaid cards (Food Card, Gift Card), and FASTag, providing a secure, convenient, and efficient alternative to cash transactions for our customers,' the company said. This will be subject to receipt of necessary approval from the Reserve Bank of India and receipt of authorisation as a Payment System Operator. Through this, the company will be competing with One97 Communications' Paytm, Walmart's PhonePe, and the biggest non-bank lender, Bajaj Finance. 'We are not competing with anyone. This is like part of our existing business only to cater to the needs of around 10 million existing customers. Our super app already has 14 million downloads,' said the company's Executive Vice-Chairman Umesh Revankar. The flagship company of the diversified conglomerate Shriram Group is set to cross ₹3 trillion in assets during the current financial year with loan growth of 15 per cent, Revankar said. The company's board also recommended a final dividend of ₹3 per share for the financial year 2024-25, subject to approval of members at the ensuing 46th AGM. Total Assets Under Management as on March 2025 increased by 17.05 per cent and stood at ₹2.63 trillion as compared to ₹2.25 trillion as on March 2024 and ₹2.54 trillion as on December 2024. 'This fiscal, I am looking at 15 per cent growth. The rural market is good. Urban demand, led by infrastructure spend that had slowed down last year, may revive this year,' he added. The Board of Directors of the company, in its meeting held on May 13, 2024, had approved the disinvestment of the company's entire stake in SHFL for ₹3,929.03 crore. The Net Interest Income for the year ended March 2025 increased by 15.99 per cent and stood at ₹22,835.09 crore as against ₹19,686.85 crore for the year ended March 2024. For FY25, the company's net profit was seen at ₹9,576.32 crore, up 29 per cent from ₹7,398.89 crore previous year.
Reuters
11-02-2025
- Business
- Reuters
Indian non-bank lender Shriram Finance eyes 20-fold growth in green portfolio, exec says
MUMBAI, Feb 11 (Reuters) - Indian non-bank lender Shriram Finance ( opens new tab aims to boost its green portfolio 20-fold over the next three years as it diversifies its loan book, a top official said on Tuesday. "We are planning to add solar panels and similar sectors to our portfolio," Executive Vice Chairman Umesh Revankar said in an interview. Shriram Finance aims for a green financing book of 50 billion rupees (about $576 million) against about 2.5 billion rupees to 3 billion rupees right now, which comprises small-ticket two-wheeler and three-wheeler vehicle loans. Green finance, which is financing of businesses that support environmentally friendly and sustainable projects, has struggled to pick up in India due to limited awareness, high transaction costs, and limited access to affordable green technologies. The government provides tax incentives and subsidies for renewable energy projects, which make them more attractive to lenders. For Shriram Finance, the electric vehicle and battery segments are likely to grow given the new offerings in the market, Shriram Finance's Revankar said. The non-bank finance company aims to double its overall loan book as well as its assets under management (AUM) by 2030, he said. Shriram's total loans stood at 2.51 trillion rupees at December-end while the AUM was at 2.54 trillion rupees. Assets under management should rise 15% in both the current and next financial years, the official said, as the firm focusses on medium and small enterprises while issuing more vehicle and tractor loans, Revankar said. "We want to understand those (small) businesses, the ability to repay and how to manage collections," he said. "We want to grow this business at a minimum 20% next year onwards." Small business loans made up nearly 14% of Shriram Finance's AUM in the October-to-December quarter, while commercial and passenger vehicle loans made up about 46% and 20%, respectively. Shriram Finance may look to tap the dollar bond route for at least $750 million in the next fiscal year depending on market conditions, Revankar said.
