Key Points
It is a scam which brings in a crisis and that makes our regulators rework on the operating guidelines for that sector..
Right from 1992 Harshad Mehta scam, which gave SEBI its teeth, in 2000 it was Ketan parekh scam which brought in major changes on trading instruments and how trades are settled..
Whether it was NBFC or bank space, the post NBFC crisis made life tough for all players..
Soon the NBFC crisis of 2018 will be completing 5 years, while clean up is still on, some companies have emerged stronger after all the changes..
The NBFC which survived and emerged stronger had one thing in common, they had strong parentage in terms of them being backed by a strong promoter group, who value their reputation..
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Backing of a strong parent: Beside’s Jio financial 7 such stocks with upside potential of up to 35%
27, Aug, 23If one looks at the survivor of the NBFC aftermath of 2018, it is very clear that a strong parentage was the common factor among the NBFC’s which not only survived the crisis but also thrived post crisis. A number of them belong to industrial groups from the southern and western part of India. Is it because they are focussed on the southern and western part of India which is more prosperous or they are more focussed on systems and processes ensuring that their loan book grows slowly but sustainably.
Regulatory tightening an opportunity for long-term investors: 6 NBFC stocks with upside potential of up to
01, Feb, 24Just a day after the biggest wealth creator from the NBFC space witnessed a sharp cut, it might appear that NBFC is not a right sector to look at. But go back to history and one would see that the time to look at a sector is when something which is perceived as negative. In the last three months, whether it is the consumer lending or housing finance segment, the RBI has been tightening the laws and regulations for provisioning. The question is why RBI is doing it and whether it will give a boost to a higher and cleaner growth. By cleaner growth, a growth which is less volatile and less accident prone. Given the fact the NBFC sector has a history of meeting with accidents and creating problems for a lot of sectors. The answer tilts toward yes, this regulatory tightening is good and in long term value accretive.