Recently RBI
has extended loan moratorium till Aug 31,2020 on one-time restructuring, taking
the total moratorium period to six months.
As per our opinion, it will affects bank’s financials
negatively. Borrowers are opting the moratorium mainly to preserve cash for future
need; which will definitely affect the retail consumptions too.
We have gone
through the April’s 2020 loan portfolio of major banks and % of borrowers base
opting for this extended 6months moratorium is scrutinized for better understanding
the Banking sector and its effect on our Banking Stocks.
Axis Bank has
around 25-28 per cent of its loan book under moratorium as of April, while for
ICICI Bank, about 32 per cent of the customers by value — both retail and
corporate . 26 per cent of Kotak Mahindra Bank’s borrowers while 71 per cent of
Bandhan Bank’s loan book by value is under the moratorium & State Bank of
India has around 20 per cent of the bank’s borrowers opting for moratorium.
With more than
70% borrower’s opting for moratorium, Bandhan Bank will find hard to manage its
loan portfolio with spike in NPA after August 2020.
Disclaimer : We are / may going to take exposure
shortly.
The
author tracks economic, behavioural and corporate tends, hoping to gauge good
avenues of return based on Fundamental Valuations of Stocks, a follower of EPV
method. You can reach me/us at |
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