'Data-dependence means you can raise or drop rates. The present stance is only for raising rates.'
Re-rating of Axis Bank's stock may continue in the near-future, believe analysts, as the risk-reward on the stock remains favourable amid healthy financials. The bullish stance comes after the Mumbai-based lender delivered a strong outperformance in the March quarter of fiscal year 2023-24 (Q4FY24) on core pre-provision profit and net profit, with improving asset quality. Axis Bank's net interest margin (NIM) expanded, against expectations, even in a tough market.
HDFC Bank's January-March quarter result, which came in-line with expectations, failed to enthuse investors. The reason? The management's decision to abstain from providing any specific growth guidance, and analysts' expectations of an arduous road to recovery. Analysts believe the path to normalisation of several growth metrics is unlikely to be a straightforward one, and the road to balance sheet realignment may be long.
The central bank tweaked the retail inflation range to 4.8-4.9 per cent in the first half of 2018-19, and 4.7 per cent in the second half.
Investors should view any bounce-back in bank stocks as an opportunity to exit the pack, analysts suggested, as the worst may not be over yet. The recent quarterly results of HDFC Bank and Axis Bank disappointed the Street, triggering a marketwide selloff by foreign institutional investors, especially in banking counters. While HDFC Bank, which was the anchor for the market correction during the past week, ended 2 per cent higher amid short covering on Wednesday, Axis Bank's shares settled 3 per cent lower.
In a mixed bag for HDFC Bank ahead of the parent HDFC's merger with itself, the Reserve Bank of India has declined to make exceptions on certain aspects, and has offered some leeway on others. The country's largest private sector lender, which is aiming to conclude the merger with the home finance major by July, had written to the central bank seeking certain forbearances after announcing the $40-billion merger in April last year. In an exchange filing this evening, HDFC Bank said it received a response from RBI on Thursday and also said that there are a few pending issues.
The broader NSE Nifty too fell over 150 points to crack below the 10,400-mark as financials, IT and energy stocks declined.
There is so much liquidity in the system, in the global economy, and that's why the stock market is very buoyant. It will certainly witness correction in the future: RBI's Das.
Higher levels could not be sustained as participants offloaded their long positions in view of September series expiry.
P2P platforms do not have the safety net. Instead of playing the role of an intermediary, if they run their own balance sheets for safety and growth, it's a recipe for disaster, warns Tamal Bandyopadhyay.
An initial reading of the guidelines indicates two factors - potential rise in borrowing cost and lower returns on investment book - could hit the spread of NBFCs.
One thing is for sure: It smacks of the regulator's lack of confidence in the bank's board, points out Tamal Bandyopadhyay.
With the stock coming under pressure, the MF holding value could have dropped to Rs 50 billion, back-of-the-envelope calculations show.
Power generation and distribution is the most indebted sector
Discussion paper fixes Rs 1,000 cr as minimum capital for these specialised banks
A 2008-style bank run seems unlikely, but if it did happen, the sector is much better prepared.
Higher interest rate will be payable to FDs of over Rs 1 cr.
Vedanta Limited (Vedanta) helping its parent and group holding company Vedanta Resources to deleverage its balance sheet has started to strain its balance sheet. Vedanta's gross debt (consolidated) was up 24.3 per cent year-on-year (YoY) in FY23 and reached a six-year high of Rs 66,628 crore by the end of March. Similarly, its net debt went up 20.3 per cent YoY to Rs 45,706 crore at the end of FY23, up from Rs 38,228 crore a year ago; it was the highest since FY20.
Moody's expects that India will record the GDP growth of around 7.5 per cent in 2015 and 2016.
The disruptions caused by COVID-19 have more severely impacted small and mid-sized corporates, including NBFCs and MFIs, in terms of access to liquidity.
The move may release funds locked in government securities and add to liquidity. With inflation expectations lowered, this should not impact bond sentiment in the short run
The RBI expects CPI inflation to fall from 5.8% in Jan '16 to 4.8% in Jan-Mar '17.
While lenders create a hype around the services offered on digital platforms, customers think otherwise, given that frustration due to the quality of service has only increased, over the years.
The problem for the NBFC sector is the funding inertia by banks and not lack of funds.
According to Soumya Kanti Ghosh, chief economic advisor of the State Bank of India group, a 50 bps rate cut is a possibility, but 25 bps is more likely.
India Inc has pitched for rate cut to boost economic activities.
The Reserve Bank is unlikely to lower the interest rates.
All real estate developers may not be able to avail the benefit of Reserve Bank of India's one-time restructuring scheme as they might not meet the required financial ratios and have the necessary credit rating, HDFC vice chairman and CEO Keki Mistry said. He was speaking at a real estate and infrastructure investor summit organised by Naredco. "Restructuring may not necessarily help every developer because not too many will be able to meet the criteria laid down in terms of meeting the various ratios and getting credit ratings," Mistry said.
It has been a year since the Reserve Bank of India (RBI) initiated prompt corrective action (PCA), an exercise that puts weak banks under central bank scrutiny, against the 94-year-old Lakshmi Vilas Bank (LVB). But recently, this low-profile Chennai-headquartered bank found itself attracting some unwonted publicity when 60 per cent of its shareholders voted against a proposal to re-appoint seven directors, including one of the promoters, K R Pradeep (who holds around 2 per cent), and the company's managing director & chief executive officer S Sundar.
The Reserve Bank has found gaps in banks' corporate governance despite issuing guidelines on the matter, Governor Shaktikanta Das said on Monday. Addressing directors of bank boards, Das said such gaps, which have been mitigated, could have caused "some degree of volatility". He also hit out strongly against "smart accounting" to conceal stress and bloat financial performance.
PS banks need to pull up their socks to improve cash flows.
RBL Bank is no Yes Bank. It's not fraught with fraud. It's a story of limitless ambition and greed for growth under a leader who doesn't want to give up, says Tamal Bandyopadhyay.
The country's most valuable lender HDFC Bank can perhaps no longer claim to be a favourite of foreign portfolio investors (FPIs). Two data indicators, both somewhat interconnected, point to this - the diminishing premium of HDFC Bank's American depositary receipts (ADRs) compared to local shares, and the ample investment opportunities available to FPIs in the domestic market. The ADR premium has shrunk to below 5 per cent, down from over 30 per cent in March 2021, and even lower than recent levels.
The past 18 months have seen a resurgence in the real estate industry, with developers regaining the ground lost to the Covid-19 pandemic. But it is once again adding inventory at a pace faster than sales. The industry's inventory rose by 28 per cent year-on-year (Y-o-Y) in H1FY24, com-pared to a 25.5 per cent year-on-year increase in net sales during the same period.
There is a narrow chance that the central bank may cut rates in the future, according to a poll of 15 economists and treasurers.
Gross bad loans of banks may rise from 6.9 per cent in September 2021 to 8.1-9.5 per cent by September 2022 if the Omicron variant strikes the economy hard, as per the financial stability report of the Reserve Bank released on Wednesday. The report also said that the rising stress level in the retail loan portfolio of banks -- the mainstay of bank credit for many years now -- was led by home loans, which grew in double-digits so far this fiscal. While asset quality improved, with gross non-performing assets (GNPA) and net NPA (NNPA) ratios declining to 6.9 and 2.3 per cent, respectively, in September 2021, the slippage ratio inched up during the same period as private sector banks showed a higher rate of deterioration in asset quality, as per the report.
Joy Thomas stated that one large account -- HDIL -- was the sole reason for the present crisis that led to the regulatory action on Tuesday when Reserve Bank of India superseded its management and placed it under an administrator for the next six months.
'As our per capita income increases and various demographic segments emerge, the need for various kinds of protection and risk covers will become even more explicit.'
He also affirmed that over time, as the government finances improve, the SLR will be brought down further.
Calling out the high real interest rates -- the differential between the policy rate and headline inflation -- as an impediment to investment, the SBI report said the RBI can cut rates by 0.35-0.50 per cent at its next policy announcement.
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