Retail Credit Potential, Uptick In Rural Demand And Top Stocks In Action

n Tuesday, share markets in India opened weak, firmed up and ended the day in the green.

The BSE Sensex closed higher by 35 points to end the day above the 34,600 mark at 34,651. While the broader NSE Nifty ended the day higher by 20 points to end at 10,536.

Among BSE sectoral indices, auto stocks rose the most by 1.7%. This was followed by metal stocks at 1.6%. P C Jeweller and Strides Shasun were among the major gainers.

Top Stocks in Action Today

TTK Prestige is likely to be in focus today after the company reported a 32% decline in net profit for the March 2018 quarter. The company reported 12.3% increase in revenues for the quarter.

Petronet LNG is another stock to watch today after the company reported its highest quarterly profit for the March 2018 quarter on processing higher volume of gas.

The Untapped Retail Loan Potential

Retail credit is in the spotlight. Sluggish loan offtake by India Inc at a time when state-run banks are struggling to resolve corporate bad loan burden has led to a shift in the focus towards the relatively safer retail loans.

Retail loans, aggressively targeted by the private sector banks so far, are now being chased by the troubled public-sector banks also. The competition, no doubt, has intensified. But the good news is that the retail loan market is far from saturation. There is a lot of retail lending potential waiting to be tapped.

As per a report by credit information company, Transunion Cibil, financial institutions and banks have been able to tap only one third of the 220 million credit eligible consumers. A whopping 150 million potential consumers, that qualify on the age and income criteria but are financially dormant, present a huge lending opportunity for sustained growth over the next five years.

The latent retail credit demand can be met by lenders through a host of loan products such as credit cards, personal loans and consumer durable loans. Further, Cibil has projected the retail loan market to increase by 14-16 million consumers annually and reach 295 million by 2022. Based on the growth curve of other countries, the credit information company, expects India’s household debt to nearly double to Rs 78-94 trillion by 2022.

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