Shares of non-banking financial companies (NBFC) have gained by up to 12% on the BSE in early morning trade after a media report suggested that the State Bank of India’s (SBIs) loan portfolio buys will provide liquidity to NBFCs.
Bajaj Finance, Dewan Housing Finance Corporation (DHFL), Centrum Capital, Shriram Transport Finance, Muthoot Finance, Equitas Holdings, Mahindra & Mahindra Financial Services and Cholamandalam Investment and Finance Company were up in the range of 5% to 12% on the BSE. In comparison, the S&P BSE Sensex was up 0.69% or 236 points at 34,535 at 09:43 am.
“The SBI's decision to buy Rs 450 billion worth asset portfolios from NBFC will provide them the much-needed liquidity,” IANS report suggested quoting a top Finance Ministry official.
"SBI today stepped up substantially a facility for purchasing portfolio of assets from NBFCs to provide liquidity to NBFCs. SBI would buy such portfolios up to a total amount of Rs 450 billion. This measure should alleviate liquidity concerns to a great extent," Economic Affairs Secretary Subhash Chandra Garg tweeted. CLICK HERE TO READ FULL REPORT.
In past one month, the market prices of most of the NBFCs were under pressure by falling up to 50% till Tuesday due to liquidity crunch triggered by a series of debt repayment defaults by financial conglomerate IL&FS and its subsidiaries.