NBFCs Q1 Earnings Review - Covid 2 Impacted Growth, Asset Quality; Recovery Expected In H2: Nirmal Bang
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Nirmal Bang Report
In Q1 FY22, we witnessed an increase in slippages and decline in disbursements and valuations.
However, capital raise carried out in the last one year, abundant liquidity and adequate provision buffers aided in strengthening the balance sheets.
Benefits from low cost of funds continued to accrue.
Shriram Transport Finance Company Ltd. reported relatively lower decline in disbursements and lower slippages compared to peers.
Cholamandalam Investment and Finance Company Ltd. and Sundaram Finance Ltd. reported strong pre provision operating profit.
But, disbursements and asset quality deteriorated on QoQ basis.
Mahindra and Mahindra Financial Services Ltd. was the most impacted in terms of asset quality and operating performance.
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