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State-Run Banks Must Be Recapitalised Without Delay, Says Dalton Capital’s UR Bhat
The demand for recapitalisation cannot be delayed any further, Bhat said.
11 Jun 2019, 12:09 PM IST
State-run banks are in dire need of recapitalisation, which would enable their reasonable growth, according to UR Bhat.
“There are no (public-sector) banks which have enough capital,” the managing director of Dalton Capital Advisors told BloombergQuint, adding that recapitalisation could help relatively healthier banks capture growth momentum in the economy. This process, according to Bhat, can't be delayed any further.
Being at a threshold isn’t good enough. They (public sector banks) need growth capital and that is hopefully going to come from the government... The budget has to address it fair and square.UR Bhat, MD, Dalton Capital Advisors
Highlights Of Conversation
Sectoral Bets
Banking
- Selective PSU banks seem good at current levels, but too early to say.
- Corporate-facing private banks to perform better, thanks to higher delta.
Auto
- Had a tough time, largely due to the non-banking financial sector crisis.
- Healthier companies may start capturing market share.
- If demand recovers in one quarter, then the sector can be looked at favourably.
- Sector always had decent demand, but was unable to convert it into actual sales due to insufficient capital.
- To focus on how much financing can come from NBFCs or banks.
Information Technology
- Traditional businesses to give way to newer technologies.
- Companies at the cutting-edge of newer technologies should be backed.
Capital Goods
- Sector is a good bet at current level.
Watch the full conversation here:
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