Author: Pranati Deva

Banks regain lost market share from housing finance companies, SBI remains investors’ favourite

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Spurred by the recent NBFC (Non-Banking Financial Company) crisis in India, which has brought the funding and low equity capitalisation issues in focus especially of the housing finance company (HFC) sector, banks have regained lost market share from the HFCs, with SBI emerging as the favourite in the housing finance space.

The market share of HFCs has fallen to about 43.6% as of December 2018 vs 46.2% as of March 2018, according to a report by Emkay. Meanwhile, many PSU Banks including major lender State Bank of India (SBI) has witnessed a surge in market shares as they have been fairly active in securitization markets in Q3FY19, the report quoted.

With robust portfolio growth of about 21.7% year-to-date (26.5% y-o-y), SBI has remained the undisputed king in the housing finance space with an overall market share of about 22.1% as of December 2018 vs 20.5% as of March 2018.

Amid NBFCs, HDFC, the previous market leader, is seeking to defend its position by managing a market share of about 15.7% as of December 2018 vs 16.8% as of March 2018. LIC Housing Finance, Indiabulls Housing, and DHFL witnessed declining market share trends, whereas PNB Housing remained the only exception with a market share gain to 3% in December 2018 vs 2.7% during March 2018.

“The trend is likely to remain favorable for banks even during Q4FY19. However, with some ease in liquidity conditions, HFCs may gain their lost ground,” the report added.

The overall mortgage portfolios of large banks (Private/PSBs) and Housing Finance Companies (HFCs) have also seen healthy growth of about 18.3% y-o-y and 12.7% (April – December 2018). Banks were the leader of the pack, clocking about 18.3% growth vs HFCs’ growth of about 6.3%. The mortgage market share of banks also improved to about 56.4% as on December 2018.

“For all large HFCs, the overall borrowing profile has improved toward longer-tenure maturities against skewed toward shorter maturities earlier. However, we expect the rebalancing of maturity profile to continue even during the current quarter, which will keep margins under pressure,” the report said

The brokerage preferred promoter backed, well-governed NBFCs/HFCs with stable liability franchise and the ability to raise money comfortably. Bajaj Finance remains their top pick in the sector, followed by HDFC, Cholamandalam Finance, and Mahindra Finance.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Nifty IT index falls for 4th straight session dragged majorly by Wipro, TCS

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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The Nifty IT index ended lower, down 2% on Monday, for the fourth consecutive on the back of sharp appreciation in rupee. Heavy selling pressure was witnessed in stocks like Tata Consultancy Services (TCS), Infosys, Wipro, Infibeam, HCL Tech, and Tech Mahindra.

Shares of TCS, Infosys, Wipro, and Tech Mahindra were leading the index’s fall declining in the range of 1.3 percent- 3.2 percent. On the flip side, Mindtree was up 2 percent in today’s trade.

IT major Infosys fell over 2 percent as the company paid Rs 34.35 lakh to settle the case with the markets regulator, according to an order. The company settled with Sebi the case of alleged disclosure lapses regarding severance payment made to its former chief financial officer Rajiv Bansal. The watchdog had issued a notice seeking to initiate adjudication proceedings against the company in November 2017.

However, according to CLSA, Infosys, HCL Tech, Wipro and Tech Mahindra are expected to see strong growth in 2019. 2019 is also expected to be better than 2018 for most Tier-1 IT firms. “Infosys and HCL Tech are our top buys,” the brokerage adds.

Mindtree gained 2 percent after the Income Tax Department withdrew the provisional attachment for the transfer or charge of 22,20,000 and 52,70,000 equity shares of Mindtree by Coffee Day Enterprises and VG Siddhartha, held by them respectively.

Meanwhile, equity benchmark indices ended in red. The Sensex fell below 35,400, ending 145 points lower, while the Nifty was able to hold 10,600, but ended 36 points lower.

Also, catch all the action and updates in our market live blog 

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow