Repco, other NBFCs zoom as RBI eases asset securitisation norms

NEW DELHI: Shares of non-banking financial companies (NBFCs) jumped on Friday after the Reserve Bank of India (RBI) relaxed rules allowing them to sell or securitise their loan books, in a bid to ease persistent stress in the sector.

NBFCs can now securitise loans of more than five-year maturity after holding those for 6 months on their books, the RBI said on Thursday.

Shares of Pankaj Piyush Trade & Investment (up 9.74 per cent), Repco Home Finance (up 7.35 per cent), Vertex Securities (up 6.77 per cent), Motor & General Finance (up 6 per cent) and PML (up 5.49 per cent) were trading higher.


Shares of GSB Finance (up 4.99 per cent), Dewan Housing Finance Corporation (DHFL) (up 4.89 per cent), Jindal Capital (up 4.88 per cent), Indiabulls Housing Finance (up 1.79 per cent) and HDFC (up 0.90 per cent) also appeared in the green zone.

Bajaj Finance shares rose as much as 2.3 per cent to Rs 2,564.40, their highest since September 19.

Brokerage Motilal Oswal said this move should be beneficial largely to housing finance companies (HFCs) only, because they have loans of over five years maturity.

The brokerage added DHFL and Indiabulls Housing will be big beneficiaries among HFCs, since they have higher share of off-balance sheet assets compared to peers and their reliance on sell-downs to raise funds has been greater in these times of tight liquidity.

(With inputs from Reuters)