NBFCs Q3 Results Preview - Business Momentum Remain Strong: Systematix

Systematix Research Report

Non banking financial companies within our coverage universe are likely to report strong assets under management growth of ~17% YoY/ 4.5% QoQ.

Loan demand remain strong across the product categories like vehicle, housing, small and medium enterprise and consumer segments, gold financiers (excluding Manappuram Finance Ltd.). Most NBFCs could see their net interest margins further contract by 10-15 basis points, given their higher borrowing costs, resulting from the rise in benchmark rates.

The full impact of this rise would be visible over the next few quarters, as and when the reset in rate happens. Asset quality could improve, as NBFCs continue to experience healthy collection efficiencies during the quarter.

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