However, its Deputy Chief Rating Officer Krishnan Sitaraman Said that even if asset growth reaches double digits, it will still be below pre-pandemic levels, which saw a growth of 20 per cent during the three years of FY19.
“Intense competition from banks and rising interest rate scenario will limit the competitiveness of NBFCs in certain sectors, making them focus on high-yielding areas for growth,” he added.
The agency said vehicle finance, which accounts for almost half of assets for NBFCs, will grow at 11-13 per cent in FY12, as against 3-4 per cent in FY12 and FY2011.
Used vehicle financing, with its higher yields, will see and drive higher growth NBFC Volume in vehicle finance, it said.
Other trends that will help asset growth will be recovery in vehicle sales, strong demand from the infra sector and the need for fleet replacement, it said, adding that new launches will boost car and utility vehicle sales.
Competition from banks and rising interest rate scenario will reduce the lead of NBFCs in the new vehicle finance segment and allow banks to gain market share in this segment.
agency director Ajit Veloni Unsecured loans, whose NBFCs account for about a fifth of the AUM pie, may be the only segment to touch pre-COVID-era growth of 20-22 per cent this fiscal, as lenders account for high-end loans. Focus on yield. Property.
He said the cautious approach of NBFCs resulted in a fall in AUM for this segment in FY21, while FY22 saw a V-shaped recovery.
Unsecured loans include consumer loans (personal loans and consumer durable loans) and business loans to small and medium enterprises (SMEs).
Given the expected growth of 7.3 per cent in gross domestic product (GDP) this fiscal, consumer loans will be supported by growth in retail spending in consumer durables, travel and other personal consumption activities, while business loans will be considered a macroeconomic tailwind. will benefit from.
Loan against property is also expected to touch a growth of 10-12 per cent, though competition will deter higher growth in this space as well.
The gold loans are expected to achieve their steady state growth rate of 10-12 per cent depending on the demand from micro enterprises and individuals respectively – to fund working capital and individual requirements, the agency said.
Wholesale finance, which has seen several players exit the market over the past few years, will continue with the decline in AUM, it said.
The agency said higher-than-expected interest rates and inflation are key monitorables.