Mutual Funds Commodities Research Tax Planning IPO Our Team Contact Us  
Google
Web www.equitybulls.com
Research

| More

Healthy credit growth of NBFCs and HFCs led to highest post-pandemic quarterly securitisation volumes in Q4 FY23, estimated at ~Rs 61,000 crore: ICRA

Posted On: 2023-04-11 19:55:00 (Time Zone: IST)


ICRA estimates that securitisation volumes, originated largely by non-banking financial companies (NBFCs) and housing finance companies (HFCs), at ~Rs. 61,000 crore in Q4 FY2023, the highest quarterly volumes seen since the onset of the Covid-19 pandemic. The volumes for the quarter are largely dominated by securitisation of retail loans (~90%). The overall securitisation volumes in FY2023 stood at ~Rs. 1,78,000 crore, i.e. a healthy 41% expansion over Rs. 1,26,500 crore seen in FY2022.

Mr. Abhishek Dafria, Vice President and Group Head - Structured Finance Ratings at ICRA, said: "The upward trend in the securitisation volumes continued for another quarter as NBFCs and HFCs witnessed increase in funding requirements to meet the growing credit demand. Overall securitisation volumes for FY2023 remained marginally higher at Rs 1.8 trillion than our earlier estimates of Rs. 1.7 trillion. The rising interest rates over the past year have not yet materially dampened the credit demand. With the Monetary Policy Committee (MPC) keeping the repo rate unchanged in the recent meeting, we expect the disbursement trends for NBFCs and HFCs to remain healthy over the near term, which will support the growth in the securitisation market across all asset classes. Nonetheless, the macro-economic conditions remain a monitorable as global economies continue to manage high inflationary pressures."

In FY2023, Mortgage-backed (MBS) loans formed the biggest chunk of the overall volumes at ~33%, followed by vehicle loans at ~28%. Microfinance loans have made a huge comeback accounting for ~20% and ~18% of Q4 FY2023 and full year FY2023 volumes, respectively. Securitisation is carried out either through direct assignment (DA) transactions (bilateral assignment of pool of retail loans from one entity to another) or through the pass-through certificate (PTC) route (instruments issued by bankruptcy remote trusts). In FY2023, the share of PTC was ~40% in retail securitisation which is largely in line with the historical trends. Securitisation of personal loans has remained strong throughout the year accounting for 3% of the total volumes.

Added Mr. Dafria: "The share of MFI loan securitisation has significantly improved to ~20% of total volumes securitised in Q4 FY2023. Securitisation market in India is gradually becoming more broad-based with asset classes like personal loans, education loans and school finance loans also gaining traction. In particular, securitisation of personal loans remained strong throughout the year accounting for 3% of the total volumes. Securitisation would remain an important funding tool for retail-focused NBFCs, as it provides funding at an attractive cost, while simultaneously achieving a well matched ALM position. Securitisation is expected to remain buoyant in FY2024 as well, though the overall volumes could see a decline of ~15-20% due to the impending merger of a large HFC with a bank post, which it is unlikely to carry out loan sell-downs."


Click here to send ur comments or to feedback@equitybulls.com

Disclaimer:The article above is a gist / extract of the original report prepared by the research firm / brokerage firm. This article is not to be considered as an offer to sell or a solicitation to buy any securities. This article is meant for general information only. www.equitybulls.com, its employees or owners or the research firms, its employees or owners won't be responsible for any liability that may arise from information, errors or omissions in these articles. www.equitybulls.com or its employees or owners / the research firms or its employees or clients or owners may from time to time hold positions in securities referred in this article. For detailed research reports, please contact the concerned research firm directly.





Other Headlines:

CRISIL Ratings: Higher workplace occupancy to light up cigarette volume 7-9%

CRISIL Ratings: Apparel retailers to grow 7-8% this fiscal via expansion, festival spur

CRISIL Ratings: For tea companies, ~8% revenue degrowth brewing this fiscal

CRISIL Ratings: Revenue of paper makers to crumple 8-10% this fiscal

ICRA expects banking sector to stay resilient, outlook remains Positive

CRISIL MI&A: Red-hot domestic demand to stave off steel price melt this fiscal

CRISIL Ratings: Replacement demand to drive tyre volume up 6-8% this fiscal

CRISIL Ratings: Home textiles makers to weave revenue, profitability rebound this fiscal

Capital outlay on roads, renewables seen rising ~35% in this and next fiscals to Rs ~13 lakh cr, backed by strong execution pace

Softening demand to moderate Indian IT services industry growth to 3-5% in FY2024: ICRA

CRISIL Ratings: Telcos may dial up Ebitda 15-17% to Rs 1.2 lakh crore this fiscal

CRISIL Ratings: Social welfare spend of states to hit a decadal high this fiscal

CRISIL Ratings: Footwear sector revenue to tread ~11% higher this fiscal

CRISIL Ratings: Robust demand to whip up dairy industry revenue 14-16%

Indian hospital industry's operating profit margin will remain healthy at over 22% in FY2024: ICRA

Weak overseas demand to snip 5-6% off jute revenue this fiscal - CRISIL

ICRA expects the telecom services industry to report moderate revenue growth of around 7-9% in FY2024 amid high capex spends

CRISIL - Viscose staple yarn makers set for 10-12% revenue growth this fiscal

Sugar mills seen unscathed despite pricier cane, lower exports - CRISIL

CRISIL Ratings: Specialty chemicals on domestic drive, revenue seen growing 6-7%

CRISIL Ratings: Higher ad spends to lift revenue 13-15% for print media this fiscal

Paytm: Top brokerages, such as ICICI Securities, Axis, Dolat lift Paytm's target price to Rs. 1250

CRISIL Ratings: Securitisation volume surges 60% to first-quarter peak

CRISIL Ratings: FMCG sector to witness 7-9% rise in revenue this fiscal

CRISIL MI&A and ATMA: Tyre industry on a roll, driving towards doubling in size

CRISIL Ratings: Slowing US, EU to chip 6-8% away from handicraft sales this fiscal

CRISIL MI&A: One out of five MSMEs to see stretch in working capital days

Yes Securities Identifies Rural India as Key Driver of Economic Recovery in Latest Report

CRISIL Ratings: Revenue of automotive component makers to grow 10-12% this fiscal

CRISIL: Residential real estate sales to grow 8-10% this fiscal

CRISIL MI&A: Cement prices to dip 1-3% this fiscal despite healthy demand

CRISIL Ratings: Aircraft MRO services revenue could leap 3x in 5 fiscals

Demand pressures to moderate revenue growth of Indian fashion retail entities to 10% in FY2024: ICRA

CRISIL Ratings: Revenue of organised gold jewellers to rise 16-18% this fiscal

CRISIL Ratings: Revenue of top 18 states to grow at 6-8% this fiscal

Automobile Sector - Monthly Quick View - May'23 - Steady YoY and MoM Growth on Low Base; UVs are Clear Winner...

CRISIL Ratings: New guidelines lend much-needed clarity to FLDG usage

MSP for kharif crops - Views of Pushan Sharma, Director - Research, CRISIL Market Intelligence and Analytics

PMI Services logs a record high, Employment scenario, however, remains a concern

Road construction to witness 16-21% jump in FY2024, ahead of General Elections: ICRA

Sustained demand momentum to drive double-digit revenue growth for the Indian hotel industry in FY2024: ICRA

HCL Technologies Ltd - Q4FY23 Result First Cut - A marginal miss on major parameters, though PAT beats expectations

Indian quick-service restaurant industry to witness strong growth in near to medium term with expected ramp-up in store additions: ICRA

HDFC Securities Institutional Research Desk: Report on Infosys - On the back foot

Infosys Ltd. Q4FY23 Result First Cut - A miss on all fronts

Impact of Monsoon forecast on Markets - Reliance Securities

HDFC Securities Institutional Research Desk: Report on Kolte Patil Developers - Premiumisation to drive the next leg of growth

Operating margin of domestic base metal entities to remain range-bound at 19-20% in FY2024: ICRA

HDFC Securities Institutional Research Desk: Report on QSR Thematic - QSR: Fishing time?

HDFC Securities Institutional Research Desk: Report on BFSI - The changing contours of debt financing


Website Created & Maintained by : Chennai Scripts
West Mambalam, Chennai - 600 033,
Tamil Nadu, India

disclaimer copyright © 2005 - 2020