AU Small Finance Bank, IDFC First Bank, RBL Bank, ICICI Bank, Axis Bank, IndusInd Bank, State Bank of India, Bajaj Finance, Housing Development Finance Corporation (HDFC) slipped 5 per cent to 7 per cent in intra-day trade.
Analysts at Emkay Global Financial Services in banking, financial services and insurance (BFSI) sector update said that the brokerage firm believes that the underlying credit appetite remains strong and reflects rising consumerism, and thus the impact of the pandemic-induced lockdowns could be just a pause. That said, we believe near-term growth momentum and asset quality improvement could be at risk, hence we recommend to stay put with quality stocks, it said.
Emkay Global Financial Services said it hosted a call with Mr. Kaushik Mehta, Founder and CEO of RULoans Distributions, one of the largest DSAs, to discuss the recent business trends in retail loans and to gauge the impact of recent localized lockdown, if any.
The first fortnight of April 2021 has been weak in terms of business (already down 20 per cent) due to lower working days and onset of an aggressive second wave of Covid-19 infections. With stricter lockdowns now in place, Mr. Mehta expects business should be down 40 per cent by month-end, but will still be better than last year as lockdowns are largely localized without much impact on the salaried class, the brokerage firm said in a report.
He believes that the credit appetite is likely to remain intact, but lenders may turn cautious, which could hurt growth in the near term. That said, growth will return once the lockdowns are eased, particularly in secured segments, and largely offset the lost business, it said.
Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.
As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.
Support quality journalism and subscribe to Business Standard.