Advantage AxisDirect
- 20 investment products
- 3 great platforms to invest
- 5 fun-tastic learn courses
- 5 powerful research segments
- 4 prestigious awards
- 9 lakh+ happy investors
Quotes
Back To Menu
-
Offerings
- Markets
- Research
- Learn
- PORTFOLIO
See underlying credit growth at 13-14%
Rajat Monga, Chief Financial Officer, Yes Bank
Mar 11, 2016 | Source: CNBC-TV18
Credit growth?:
We have to first look at the last year in the perspective of what was going on commodities were compressing dramatically, which was also leading to its corresponding effects on working capital in terms of prices maybe the working capital in quantity is not shrinking but in terms of values are shrinking. Take the case of oil marketing companies when oil was at very high prices they would borrow from banks regularly for bridging their deficits. That is all gone away. So credit growth has been affected a whole lot also by what was happening in last year. Underlying credit growth should be closer to more like 13-14 percent and we should see that come through as we go into the next year and we are already seeing some of the seasonal effects of credit growth improvement already, which is in this particular quarter we should see some good improvements in credit as much as this quarter itself.
Should we expect 40 bps rate cuts in the marginal side?:
The liquidity in my opinion by third week April will be neutralised. So you should be able to say that there is now sufficient liquidity, not surplus liquidity. This is also a busy season, which also has a very high incidence of increase in currency and circulation. So cash goes up in the economy. That also has a drain on the liquidity. So, April third week is when redemptions happen when government expenditure has taken place when the cash starts to come back to banks. That is when the liquidity starts to turn. It also depends how hard March will be because March is looking particularly tight on liquidity. If March is hard, it will have its own carry forward into April possibly May, so I don’t think the rate cuts will be immediate.
Stress in iron & steel sector?:
It is fair to say that the stress has increased. There has also been some mitigating developments in the mean time when we have seen government take some price action on the import side so that is helping the steel sector right now. However, it has only been a couple of months or may be less that the impact has been seen. So, we haven’t seen data coming out of the steel sector a whole lot since the government action has been taken. The sense a little bit is that the steel sector has been hurting for the last 9-12 months but I don’t think on the operational front, they are worsening any more. They already have seen a fair bit of pullback on account of the global supply situation.
Stress has reduced for?:
Generally that we have seen off late last two to three years stress coming from -- on a general basis -- infrastructure sector, construction sector and for the last 12-18 months from the iron and steel sector as well. I will be confident in saying that stress is reducing in much of the infrastructure sector, road sector in particular. We had seen a long list of stalled road projects. There are only a dozen or so road projects which need little bit of working out. The government is doing a very constructive role in terms of getting the road projects to a good conclusion. On the power sector, there have been moving challenges but in general we think that the coal supply is far better. Gas supply has improved, energy prices from the raw material stand point are down. So, there is a general broad based improvement.
Related Keyword
Financial Planning_t
Insurance_t
Market outlook
Head-Research
Similar Articles
Show more...vV5.0.0.6-60 Thanks for Liking, Please spread your love by sharing...As you have logged in from a different device/browser. This session has expired.Image size cannot exceed 512 KB. - Markets