NBFCs in consumer space will start to look good: Anand Tandon, Independent Analyst

In a chat with ET Now, Anand Tandon, Independent Analyst, shares his views on markets. Excerpts:

ET Now: Do you like any of the listed brokerages and would you be bullish on the pack at large?

Anand Tandon: They are hardly brokerages, they are also NBFC in the true sense for the term with business in terms of capital markets. So the extent that their exposure to capital markets will index them to a better result in the near term, there is some reason to be positive on them.

But the real call you are taking on their ability to continue to grow their loan book and in that sense the market is generally benign towards companies which are positioned to market themselves reasonably and keep their asset quality under control.

Brokerages will be lending against either shares or perhaps loan against properties, those two being the biggest portfolios and both of them are likely to do reasonably well. So the only catch is that the yields on some of these things are not very high because of the competition so you have to end up taking some rather dubious quality exposure.

Anyone who manages the exposure reasonably well has no reason but to do well. The question is only of the timing when do you want to buy what because all said and done there are other NBFCs also in the consumer space, which will at some stage or the other, start to look quite good and therefore it is a question of shifting priorities between banks, public sector banks, NBFCs, housing finance companies and so on.

ET Now: What is your call for the markets in the near term?

Anand Tandon: My only comment on the market would be that you may want to be looking at sectors which are a lot more boring and less exciting than what are directly related to the budget and that may perhaps give you somewhat better returns in the near term.