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<ul><li><keyword id="81680" type="COMPANY" weightage="20" keywordseo="MM-Financial-Services">M&amp;M Financial Services</keyword> is hitting the market with a ₹3,089 crore rights issue, today.</li><li>Business Insider caught up with the Vice Chairman and Managing Director <keyword id="284481" type="PERSON" weightage="20" keywordseo="Ramesh-Iyer">Ramesh Iyer</keyword> in an exclusive chat and posed the following questions. </li></ul>M&amp;M Financial Services, a non-banking finance company with a market capitalisation of ₹15,000 crore (over $2 billion), is hitting the market with a ₹3,089 crore rights issue. Existing shareholders will get rights to buy additional shares in the company at a cost of ₹50 a piece, a discount to the current market rate of a little less than ₹130. This kind of fundraising is usually undertaken to shore up capital and increase the net worth of the company. <div type="image" title="M&amp;amp;M share fin" msid="77212373" hostid="261"></div> However, this says a lot about what the company believes are the prospects in the near term. Business Insider caught up with the Vice Chairman and Managing Director Ramesh Iyer in an exclusive chat and posed the following questions. You can watch the entire interview here. <div type="twitter" handle="BiIndia" handlename="Business Insider India🇮🇳" image="http://pbs.twimg.com/profile_images/1232926719016718336/sfffJHNV_normal.jpg" favoritecount="6" retweetcount="0" status="#HangoutwithBI | @BiIndia's @iyer_sriram in conversation with @ramesh_md, VC &amp; MD of @MahindraFin as investors prep… https://t.co/bQBjcyl9k7" createdat="1595842176000" id="1287681535068344321"></div> These are the edited transcripts of the interview. What do you make of the market reaction that the stocks have been tumbling down for the past few days? Why aren't investors excited about this? So, I am not too sure the market going down has anything to do with the Rights (issue). I think there is mixed news coming around on what's happening in rural (areas), how the market is panning out, if there's going to be a next moratorium, right? And, if the moratorium was not to be there, how do the NPA’s and the industries start to perform? So, I think it's all at the back of the performance and not anything to do with the Rights Issue. What is the goal of the rights issue? So clearly it boosts the capital base but the overall money is about ₹3,100 crore, which is at the current level equal to one-months disbursement. So, don't look at it from a cash flow perspective, look it from a cash boost perspective. Straight away from the 15-17% capital adequacy you go to 19-20% adequacy level, which gives you phenomenal leverage capital and gives you room space for growth in future. And, for some reason, you know the market conditions turn negative because of COVID. And (if) COVID turns much larger than anybody imagines, then it also addresses your insolvency issues and you remain absolutely strong. So it's a stitch in time or preparing for the worst and aiming for the best? I think when we discussed the need for capital and Rights Issue as a format in April, obviously, we thought we should prepare for the worst. Because you know the lockdown has just begun and nobody had a clue on how long it will stretch and the moratorium got announced, and you know everything is going negative, no sales happening. That's why everyone wanted to be prepared for the future. As came May and June, and then we started seeing the phenomenal revival of the rural market. The pitch turned to that if things are getting better, you will have a phenomenal opportunity of taking the growth of 35% (YoY), and that, again, will need capital. So you are gunning or 35% growth again this year? Not this year, this year is out of the question. I think nobody will talk about growth this year. I think everybody should look at … if it's beginning to happen. If you look at March volumes, it will be at 50-60% of the previous year. Because you have already lost a quarter without doing much in the market. And, July and August are not going to be kind of very aggressive. Anything that will happen will happen post-October. Any growth anyone is taking is I guess 2021, 2022, 2023 kind of a story. I think FY21 is gone, you will have much smaller volumes, and all of ourselves will fight to keep ourselves afloat. Let's talk about cost-cutting and the changes you are making? Cost of funds has definitely come down as you said. And, you know, even pre-COVID, if you look at our Q2, Q3 last year also. We have said that we will also focus on various cost initiatives, and we look at line item wise. For a company like ours, we will not have only one line item completely cut by, and that will save a lot of costs. So are you shutting down branches? No, we are not. So what we are actually doing is we have looked at each line. For example, we looked at the branch rent rationalising. So we renegotiated rent, we have moved to new places and all kinds of stuff. The second is all the peripherals attached to the branch like securities or weather BPO services, below the line advertising and funding exercises, the travelling and conveyance expenses. So if you use a little more technology and digital, you will be able to bring down conveyance cost. On the people front, our belief has been very different and very strong. We think that if at all you are talking of people cost that should be the last to look at but can't be the starting point. We have cumulatively 2 million customers from whom we have to recover money. So you need people for that, you may not grow that year, but you need people for what you have done already. And, branches are on that also. Each branch will have 3000-4000 customers to manage. You can't just shut a branch looking at some few thousand rupee cost. Once the market revives, some of those expenses will return. But our own understanding is that at least about 20% of the expenses come down from the previous year, even if things were to return to absolute normalcy. Your NPAs level is around 10%. Is that correct and if that is correct, where do you see this by the end of March? So two things have happened while the gross has been a little higher than March, but the net has been lower than March. So we have taken a little aggressive position based on the geographies and based on certain product behaviours and segments, there have been some higher provisions. So as we progress you the next six months, which is normally the good six months, we would not see a decline in the gross NPA, and we will maintain our stance on aggressive provisions. And, we will have a very close look at understanding what's happening in the market. And, if we start seeing things are not improving as we think, then we may take higher provision, whichever is necessary. COVID is now spreading beyond cities, is that something you are taking into account yet? I think it is important to look at rural from a very different perspective. We are seeing UP, we are seeing cases, we are seeing Bihar, we are seeing cases. But is it concentrated at one place, no, unlike major cities where it is concentrated in numbers. In rural it's a very wide number like in some villages 2 cases and in some other villages some few cases, so it does not affect the overall economic activity of that place. So even as we speak and we are also seeing this number going up in different cities, but that's not affecting the local activity completely, because it's not concentrated and the activities are spread across like farming, that is not going to be affected even if some cases are there. What has been the trend like for M&amp;M Financial Services? In June more than 40% of the people who opted for the moratorium have actually repaid their instalments. My understanding is you will see from the fourth quarter, i.e. January onwards or maybe for October, you will start seeing good trends but Jan onwards one can start seeing the infra cash flow coming in. And that should do good for the rural. What have your collection trends been like? From April to May, it was double of April. April was a disaster at 14-15%. It went to 25% or 30 in May. And went up to upwards of 77% in June. And, July good news is that as we see our numbers. It is equal or better than our June number. It's holding up very well. Does that seem like a level that's going to continue for some time? I think July-August enrols no major activity even in normal time, when monsoon is around the economic activity comes down. The real test will be what happens in the third quarter— post the monsoon. How does the festival season pan out - when the activity begins to happen. And when the monsoon ends, what's the outcome of the monsoon? Is the yield likely to be good? I think the third quarter will be the test, and you will start seeing post-November money will start coming in, stretching till February. What happens if the government goes for another lockdown and another moratorium ? What at least we see from a retail customer perspective is not all of them need a 90-day moratorium. Some of them need a restructuring of the loan because they need a smaller EMI because their income has shrunk and they are not able to repay so much, Some of them want a much extended period of debit. Some of them want a shorter moratorium; maybe a 1-month moratorium because let's take a farmer, he may say my money is going to come in November, right, so please give me 30 or a 45-day moratorium, not a 90 day because I don't want to bear that interest. So, if you were to take it this way then my point of view would be— restructuring would be a good approach where an institution can look at each customer and segment and then look at what is required. For example, a heavy commercial vehicle operator, 90 days may be insufficient because he may start earning only post-January or whenever because currently, he has no volumes to carry, Right? So, now you have given 90 days, he will consume that 90 days, and again he is going to be not able to pay it, once he opens up in January. So, if you put all of this together at least at the retail level, our understanding is if you give a restructuring which is a responsibility of the company to see to whom you want to give and what kind of a restructuring you want to give and put in place an approved process by which you will be monitoring it. But that is a risk, right? But then, there is enough ring-fencing, they have said that freeze the accounts as of February 29, and they should be standard account on that. There should not be more than two instalments outstanding on that day, they should not already be an NPA account, so there is a very clear ring-fencing which has happened. It is then ultimately the responsibility of the organisation - whom do you give what kind of restructuring and what kind of a time frame. So, you know that's what the ask is, or a request is that if it can be considered on a restructuring basis with responsibility. Have you made any change in the term of the assets whom you were lending to, in a post COVID scenario? Not because of post-COVID, I think it's an outcome of an absolute volume for each product. If April was no sales month. May saw more tractors sales and less vehicle sales and June continued that way. If you look at the monthly disbursement. I think 45-50% of the disbursement went to tractors. And, the balance went to other vehicles. But on an overall, where the book is concerned, one month doesn't tell the balance. What is your current mix like? So about 17-18% is tractor, another 25% would be <keyword id="45224" type="DOMAIN" weightage="20" keywordseo="Mahindra">Mahindra</keyword> auto parts. Then cars about 28%, then pre-owned vehicles about 10% and then small commercial vehicles and commercial vehicles all together will be 8-10%. I think SME has dropped to around 1-2%. Is it a concern on heavy reliance on the automotive sector because of the trouble that the sector is going through? I think that's not the right thing. It is divided between urban and rural again. I think what you don't see is an auto demand. It's not an urban phenomenon. If you talk to any OEM (original equipment makers e.g car manufacturers), they are all talking of rural revival. Dealerships have improved. Actually, the real constraint for the auto current is supply. They are not able to make vehicles available to the dealership while there is sufficient demand for small cars, pickups, small three-wheelers, this kind of product. And the inventory levels at the dealerships is at its lowest. I think if they can make sufficient vehicles available, I think there is enough demand. SEE ALSO: <a href="https://www.businessinsider.in/business/corporates/news/tech-mahindra-sees-sharp-slowdown-in-all-verticals-except-media-and-entertainment/articleshow/77197985.cms" data-type="tilCustomLink">Tech Mahindra sees sharp slowdown in all verticals except media and entertainment</a> <a href="https://www.businessinsider.in/india/news/escorts-earnings-only-show-that-calling-a-rural-recovery-right-now-would-be-pompous-all-eyes-will-now-be-on-mm/articleshow/77200867.cms" data-type="tilCustomLink">Escorts earnings only show that calling a rural recovery right now would be pompous⁠— all eyes will now be on M&amp;M</a>

EXCLUSIVE: M&M Financial Managing Director gets candid about the rights issue, the bleak prospects for this year and why there should be no more loan moratorium

Mumbai, Mar 23 () With the coronavirus outbreak bringing economic activity to a halt, non-banking financial companies (NBFCs) have sought a one-time restructuring for all existing standard accounts that can potentially default in future. The companies have also asked for relaxation in provisioning requirement for such accounts. NBFCs are at the forefront of financing many of the affected sectors such as small road transport operators, taxi aggregators, infrastructure contractors, MSMEs and traders. In order to help borrowers who are facing challenges, the Finance Industry Development Council (FIDC), a representative body of assets and loan financing NBFCs, has written a letter to the finance ministry and the Reserve Bank of India, suggesting a slew of measures. "Allow one-time restructuring of all regular accounts that are today not in default, but those that may become delinquent in the future without the extant requirement of 5 per cent provisioning in the NBFCs' books," FIDC Chairman Ramesh Iyer said in the letter. The body has also requested to extend the period for recognition of non-performing assets (NPAs) for NBFCs from the current three months to six months past due, but only in cases that are non-delinquent as on March 1, 2020. "Any provision made on loans that are already NPA should not be allowed to be written back to ensure maintenance of the sanctity of recognition of prior NPAs," Iyer said. The slowdown in commerce has resulted in low capacity utilisation of trucks, machinery and other equipment of MSMEs and contractors, FIDC said. Lock-up of commercial spaces such as malls, restaurants and restriction on the number of workers on site by several municipalities and local government is seriously affecting business cash flows, it said. The current situation is likely to result in delayed payment of equated-monthly instalment (EMIs) even by customers with a hitherto excellent and unblemished repayment history, FIDC said. This may adversely affect their credit scores for no fault of theirs, seriously impairing their ability to raise finance in the future for business, Iyer said. "A moratorium should be announced on payment of EMIs for at least a three months period by deferring at least three EMIs. This would ensure that unintended defaults do not affect credit track record and bureau scores of customers," he said. The industry body said most of its members have received requests from their customers, who are already facing a severe strain on their cash flows, for a deferral of EMIs. HV HRS

NBFCs seek one-time restructuring for standard accounts that may default in future

Mumbai, Apr 29 () Mahindra &amp; Mahindra Financial Services Ltd (Mahindra Finance) on Wednesday said global financial services group Manulife has acquired 49 per cent stake in its wholly-owned subsidiary Mahindra Asset Management Company. Under the agreement, which was announced in June last year, Manulife has invested USD 35 million or Rs 265 crore to pick up 49 per cent stake in Mahindra AMC, a company statement said. The Singapore arm of Manulife, Manulife Investment Management (Singapore) Pte. Ltd, has bought 49 per cent stake in the joint venture where Mahindra Finance will now own the balance 51 per cent. "I am confident that this partnership will help accelerate our efforts towards increasing mutual fund penetration, through innovative products and solutions and best in class service standards," Mahindra Finance vice-chairman and managing director Ramesh Iyer said. Mahindra AMC's managing director and CEO Ashutosh Bishnoi said Manulife Investment Management naturally fits as the right strategic partner for Mahindra Mutual Fund, as they bring over 150 years of fund products experience across all types of economic cycles and scenarios. "Besides, their global best practices and processes will help Indian investors manage risk more sensibly," he said. Mahindra AMC's annualized average assets under management stood at Rs 5,217 crore as of March 31, 2020. It has more than 2.12 lakh customer accounts and is offering over 13 investment schemes. Manulife provides wealth and asset management and life insurance solutions for individuals, groups and institutions around the world, with assets under management and administration of over USD 915 billion as of December 31, 2019. HV MRMR

Manulife picks 49pc stake in Mahindra AMC for Rs 265 cr

<ul><li>Market sentiment in some of the <keyword id="6354298" type="General" weightage="20" keywordseo="stocks" source="Orion">stocks</keyword> have turned positive suddenly in the last five days due to change in sector outlook and so on.</li><li>Shares of <keyword id="46294" type="General" weightage="20" keywordseo="nalco" source="Orion">NALCO</keyword> surged more than 11% in the last 5 days due to the rise in metal prices.</li><li><keyword id="381854" type="General" weightage="20" keywordseo="indiamart" source="Orion">IndiaMART</keyword> InterMESH and Hindustan Aeronautics gained more than 10% during the period as it entered the futures and options market.</li></ul>A few weeks ago the fear of loan defaults by small borrowers in the microfinance segment made <keyword id="2240511" type="General" weightage="20" keywordseo="bandhan-bank" source="Orion">Bandhan Bank</keyword> look very vulnerable. Similar pain among shopkeepers, vendors and other micro, small and medium enterprises (MSMEs) would keep dragging the stock of IndiaMart back to near ₹7,000 levels. The outlook didn’t seem to improve sharply for aviation and Interglobe Aviation, which operates <keyword id="6354706" type="General" weightage="20" keywordseo="indigo" source="Orion">IndiGo</keyword> Airlines remained subdued for much of July and August. But all these stocks, along with a few others, seemed to have suddenly gained traction in the last five days. Here are seven such stocks that have picked momentum in the last five days: <table style="border-width: initial; border-style: none;" class="redcator-table-advance"></colgroup><tbody><tr><td style="border-left:solid #000000 0.8333325pt;border-right:solid #000000 0.8333325pt;border-bottom:solid #000000 0.8333325pt;border-top:solid #000000 0.8333325pt;vertical-align:bottom;padding:2pt 2pt 2pt 2pt;overflow:hidden;overflow-wrap:break-word;">Companies </td><td style="border-left:solid #000000 0.8333325pt;border-right:solid #000000 0.8333325pt;border-bottom:solid #000000 0.8333325pt;border-top:solid #000000 0.8333325pt;vertical-align:bottom;padding:2pt 2pt 2pt 2pt;overflow:hidden;overflow-wrap:break-word;">Stock performance in last 5 days </td><td style="border-left:solid #000000 0.8333325pt;border-right:solid #000000 0.8333325pt;border-bottom:solid #000000 0.8333325pt;border-top:solid #000000 0.8333325pt;vertical-align:bottom;padding:2pt 2pt 2pt 2pt;overflow:hidden;overflow-wrap:break-word;">First 25 days of August </td></tr><tr><td style="border-left:solid #000000 0.8333325pt;border-right:solid #000000 0.8333325pt;border-bottom:solid #000000 0.8333325pt;border-top:solid #000000 0.8333325pt;vertical-align:bottom;padding:2pt 2pt 2pt 2pt;overflow:hidden;overflow-wrap:break-word;">National Aluminium Company </td><td style="border-left:solid #000000 0.8333325pt;border-right:solid #000000 0.8333325pt;border-bottom:solid #000000 0.8333325pt;border-top:solid #000000 0.8333325pt;vertical-align:bottom;padding:2pt 2pt 2pt 2pt;overflow:hidden;overflow-wrap:break-word;">12% </td><td style="border-left:solid #000000 0.8333325pt;border-right:solid #000000 0.8333325pt;border-bottom:solid #000000 0.8333325pt;border-top:solid #000000 0.8333325pt;vertical-align:bottom;padding:2pt 2pt 2pt 2pt;overflow:hidden;overflow-wrap:break-word;">-15% </td></tr><tr><td style="border-left:solid #000000 0.8333325pt;border-right:solid #000000 0.8333325pt;border-bottom:solid #000000 0.8333325pt;border-top:solid #000000 0.8333325pt;vertical-align:bottom;padding:2pt 2pt 2pt 2pt;overflow:hidden;overflow-wrap:break-word;">Mahindra &amp; Mahindra Fin Services </td><td style="border-left:solid #000000 0.8333325pt;border-right:solid #000000 0.8333325pt;border-bottom:solid #000000 0.8333325pt;border-top:solid #000000 0.8333325pt;vertical-align:bottom;padding:2pt 2pt 2pt 2pt;overflow:hidden;overflow-wrap:break-word;">8% </td><td style="border-left:solid #000000 0.8333325pt;border-right:solid #000000 0.8333325pt;border-bottom:solid #000000 0.8333325pt;border-top:solid #000000 0.8333325pt;vertical-align:bottom;padding:2pt 2pt 2pt 2pt;overflow:hidden;overflow-wrap:break-word;">-3.60% </td></tr><tr><td style="border-left:solid #000000 0.8333325pt;border-right:solid #000000 0.8333325pt;border-bottom:solid #000000 0.8333325pt;border-top:solid #000000 0.8333325pt;vertical-align:bottom;padding:2pt 2pt 2pt 2pt;overflow:hidden;overflow-wrap:break-word;">Bandhan Bank </td><td style="border-left:solid #000000 0.8333325pt;border-right:solid #000000 0.8333325pt;border-bottom:solid #000000 0.8333325pt;border-top:solid #000000 0.8333325pt;vertical-align:bottom;padding:2pt 2pt 2pt 2pt;overflow:hidden;overflow-wrap:break-word;">7% </td><td style="border-left:solid #000000 0.8333325pt;border-right:solid #000000 0.8333325pt;border-bottom:solid #000000 0.8333325pt;border-top:solid #000000 0.8333325pt;vertical-align:bottom;padding:2pt 2pt 2pt 2pt;overflow:hidden;overflow-wrap:break-word;">-11.60% </td></tr><tr><td style="border-left:solid #000000 0.8333325pt;border-right:solid #000000 0.8333325pt;border-bottom:solid #000000 0.8333325pt;border-top:solid #000000 0.8333325pt;vertical-align:bottom;padding:2pt 2pt 2pt 2pt;overflow:hidden;overflow-wrap:break-word;">IndiaMART InterMESH </td><td style="border-left:solid #000000 0.8333325pt;border-right:solid #000000 0.8333325pt;border-bottom:solid #000000 0.8333325pt;border-top:solid #000000 0.8333325pt;vertical-align:bottom;padding:2pt 2pt 2pt 2pt;overflow:hidden;overflow-wrap:break-word;">10% </td><td style="border-left:solid #000000 0.8333325pt;border-right:solid #000000 0.8333325pt;border-bottom:solid #000000 0.8333325pt;border-top:solid #000000 0.8333325pt;vertical-align:bottom;padding:2pt 2pt 2pt 2pt;overflow:hidden;overflow-wrap:break-word;">-3% </td></tr><tr><td style="border-left:solid #000000 0.8333325pt;border-right:solid #000000 0.8333325pt;border-bottom:solid #000000 0.8333325pt;border-top:solid #000000 0.8333325pt;vertical-align:bottom;padding:2pt 2pt 2pt 2pt;overflow:hidden;overflow-wrap:break-word;">Interglobe Aviation (Indigo) </td><td style="border-left:solid #000000 0.8333325pt;border-right:solid #000000 0.8333325pt;border-bottom:solid #000000 0.8333325pt;border-top:solid #000000 0.8333325pt;vertical-align:bottom;padding:2pt 2pt 2pt 2pt;overflow:hidden;overflow-wrap:break-word;">12% </td><td style="border-left:solid #000000 0.8333325pt;border-right:solid #000000 0.8333325pt;border-bottom:solid #000000 0.8333325pt;border-top:solid #000000 0.8333325pt;vertical-align:bottom;padding:2pt 2pt 2pt 2pt;overflow:hidden;overflow-wrap:break-word;">1.70% </td></tr><tr><td style="border-left:solid #000000 0.8333325pt;border-right:solid #000000 0.8333325pt;border-bottom:solid #000000 0.8333325pt;border-top:solid #000000 0.8333325pt;vertical-align:bottom;padding:2pt 2pt 2pt 2pt;overflow:hidden;overflow-wrap:break-word;">Hindustan Aeronautics </td><td style="border-left:solid #000000 0.8333325pt;border-right:solid #000000 0.8333325pt;border-bottom:solid #000000 0.8333325pt;border-top:solid #000000 0.8333325pt;vertical-align:bottom;padding:2pt 2pt 2pt 2pt;overflow:hidden;overflow-wrap:break-word;">13% </td><td style="border-left:solid #000000 0.8333325pt;border-right:solid #000000 0.8333325pt;border-bottom:solid #000000 0.8333325pt;border-top:solid #000000 0.8333325pt;vertical-align:bottom;padding:2pt 2pt 2pt 2pt;overflow:hidden;overflow-wrap:break-word;">5.60% </td></tr></tbody><tbody></tbody><tbody></tbody></table> National Aluminium Company Shares of the state-run aluminium maker have surged 11% in the last 5 days as the metal prices have been rising because of supply-side bottlenecks in the world’s largest primary aluminium producer, China. Aluminium prices are reportedly expected to stay elevated in the near term. Growing disruptions in supply from China are driving prices up. The disruptions are largely because of new emission rules, power shortages and floods in July. High aluminium prices means better realisations for aluminium makers. <keyword id="149555" type="General" weightage="20" keywordseo="mahindra-mahindra-financial-services" source="Orion">Mahindra &amp; Mahindra Financial Services</keyword> The non-banking finance company’s stock has surged 8% in the last five days led by heavy volumes. Volumes traded in the stock remained elevated above 5-18 million in the last five days. Besides, the financier was at more than 95% collection efficiency in July and expects it to continue as things normalise, said Ramesh Iyer, vice chairman and managing director of the company in an interview with <a href="https://www.cnbctv18.com/finance/raul-rebello-joins-mm-fin-as-coo-confirms-ramesh-iyer-10501961.htm">CNBC-TV18.</a> The market capitalisation of the company stood at ₹19,768 crore as on August 31. Bandhan Bank Investors seem to be picking up the Kolkata based bank’s stock on expectations of high returns. Analysts at Credit Suisse reportedly believe that the bank would give more than 20% return on equity. With this, it has set a target of ₹370 apiece. As on August 31, the stock price is at ₹284.70 per share. Analysts at Kotak Securities feel the same, as it says return on equity is likely to move more than 20%. After the bank reported a 32% on year decline in net profit due to high provisions, analysts at Kotak Securities said it sees an improvement in the second half of FY22 as the economic situation improves. It has set a target price of ₹335 per share. IndiaMART InterMESH Another stock that turned around in the last five days was B2B e-commerce platform IndiaMart InterMESH. The stock surged more than 10% in 5 days against tepid trading in the rest of August. This is primarily because the company’s stock has been added to the futures &amp; options market from August 27. The move boosts participation in the stock as investors and institutions can hedge underlying positions in the stock. Moreover, the B2B e-commerce platform’s consolidated net profit grew by 19% year-on-year to ₹88 crore for the quarter ended June 30, 2021. Hindustan Aeronautics Shares of the state-owned aerospace and defence company were triggered after the company signed a $716-million deal with GE Aviation for supply of engines. Moreover, the stock’s inclusion in the futures and options segment also fueled the rally. ICICIdirect has reportedly set a target price of ₹1,380 per share for the next three months. The stock price stood at ₹1,369.35 as on August 31. <keyword id="11941399" type="General" weightage="20" keywordseo="aptus-value-housing" source="Orion">Aptus Value Housing</keyword> Finance India Shares of the newly listed housing finance company made a turn around after its weak listing last week. Shares of the company had debuted with 6% discount to its issue price and now in the last five days, it has gained 6%. Analysts had remained positive on the stock despite tepid listing as it expects the company to do well in the long run given consistent strong financial performance, industry leading return ratios and good asset quality. Interglobe Aviation Shares of the airline company have been gaining on expectation of recovery in air traffic as pace of vaccinations goes up. A report by ICICI Securities reportedly said that the average daily passenger traffic is recovering gradually after dropping to a low in May 2021 due to second COVID-19 wave’s restrictions. Besides, the appointment of Gregg Saretsky as a special advisor also gave some support to the stock price. He is said to work closely with the executive leadership team to accelerate operational and commercial improvement opportunities at the airline. SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/business/startups/news/two-wheeler-financing-company-oto-raises-6-million-to-offer-services-in-15-indian-cities/articleshow/85794223.cms">Two-wheeler financing company OTO raises $6 million to offer services in 15 Indian cities</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/stock-market/news/these-are-some-interesting-data-points-behind-niftys-record-rally/slidelist/85792598.cms">These are some interesting data points behind Nifty’s record rally</a>

The market mood around these seven stocks has suddenly changed ⁠— here's why

<ul><li>Canada-based global investment firm <keyword id="172205" type="COMPANY" weightage="20" keywordseo="Manulife">Manulife</keyword> forms a 51:49 partnership with <keyword id="6428152" type="UNKNOWN" weightage="20" keywordseo="mahindra-finance">Mahindra Finance</keyword>. </li><li>Manulife will invest $35 million for 49% stake in the JV. </li><li>Mahindra Finance stock tumbled nearly 3% after the announcement. </li><li>Mahindra Finance does not rule out the possibility of entering general insurance.</li></ul>Mahindra Finance on Thursday announced a joint venture with Canadian fund Manulife, with its subsidiary Mahindra Asset Management Company. The 51:49 joint venture aims to expand the depth and breadth of fund offerings and retail fund penetration in India. Manulife will invest $35 million for 49% stake in the JV, which would value the Mahindra AMC at about $71 million. The investment from Manulife will go into the asset management company, not Mahindra Finance, according to Ramesh Iyer, Vice Chairman and Managing Director, Mahindra Finance. "General insurance is an opportunity we are looking at," he added. The mutual fund business in India is a crowded place and the top few players control a lion's share of the market. "Even if we double our market share from the current 4%, the business will grow substantially," Ashutosh Bishnoi, MD and CEO of Mahindra AMC said, adding that the company is looking to create new segment of investors, and not looking to snatch from other players. "Our desire is to become a top tier mutual fund in India," said Michael Dommermuth,head of Manulife AMC in Asia. The firm has $849 billion funds under management globally. About 28% of Mahindra AMC's retail assets are outside the top 30 cities in India. Of the ₹5000 crores, nearly ₹3000 crores are institutional investments.

Global financial services major Manulife enters India in a joint venture with Mahindra Finance

<ul><li>The <keyword id="6354335" type="ORGANIZATION" weightage="20" keywordseo="reserve-bank-of-india">Reserve Bank of India</keyword> has proposed 15% capital adequacy as a benchmark and LIC Housing Finance is short of that.</li><li>The new restrictions proposed by the regulator will also limit the amount of dividend paid by other non-banking finance companies.</li><li>Check out the latest news and updates on <a href="https://www.businessinsider.in/" data-type="tilCustomLink" target="_blank">Business Insider</a>. </li></ul>The Reserve Bank of India issued a draft circular that proposed restrictions on non-banking finance companies declaring dividends. And, according to analysis by Emkay, only two companies, LIC Housing Finance and M&amp;M Financial Services, in that space do not meet the conditions, under current circumstances, for paying dividends set by the central bank. However, M&amp;M Finance has clarified that it would be eligible. Not surprisingly, it took a toll on the two stocks. <table style="border-width: initial; border-style: none; width: 468pt; table-layout: fixed;"></colgroup><tbody><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Stock </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Losses on Dec 10 </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">LIC Housing Finance </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">-3.11% </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Mahindra and Mahindra Financial Services </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">-3.35% </td></tr></tbody></table> The RBI has proposed a capital to risk weighted assets ratio (CRAR) of 15%. Simply put, CRAR is a measure of how much capital the company has compared to the riskiness of its loans. If the borrower fails to repay, the capital would be the cushion to absorb the loss. And LIC Housing Finance fails to meet the RBI threshold on this count. The capital adequacy ratio has been 14.4%% for the company in the last two financial years and 14.5% for the first half of the current one, the report said. The way out of this is that the company can raise money from the market to boost this figure past the 15% mark, and then, shareholders can expect a dividend. M&amp;M Financial, on the other hand, doesn’t make the cut on RBI’s benchmark for paying dividend because the amount of bad loans on its books is a little more than what the regulator likes. The circular has set the threshold at 4% while M&amp;M Financial has a net NPA (non-performing assets) of 4.7%. However, if the firm is able to recover enough loans by March 2021 to bring the metric below 4%, dividend may be back on the table. In the year before COVID-struck, the one ending in March 2019, the company paid a handsome 25.7% dividend to shareholders. On the other hand, in a statement to Business Insider, M&amp;M Financial stated “As per the circular, RBI has proposed a twin matrix of CRAR and NNPA and accordingly specified 4 categories based on a combination of both. CRAR of MMFSL has been above 18% for the last 3 years. Hence, the company will fall in Category B as per the matrix. Secondly, MMFSL’s net NPA at the end of September 30 was 4.7%, based on which our permissible dividend payout ratio is ‘up to 20%’,” the company said. This is not the first time the spotlight has fallen on M&amp;M Finance’s chunk of bad loans. The pandemic has only increased the risk of defaults and therefore the company too has been aggressively setting aside money to cover the losses if they occur. “As we progress, the next six months, which is normally the good six months, we would not see a decline in the gross NPA, and we will maintain our stance on aggressive provisions… if we start seeing things are not improving as we think, then we may take higher provision, whichever is necessary,” Vice Chairman and Managing Director Ramesh Iyer told Business Insider <a href="https://www.businessinsider.in/stock-market/news/mahindra-and-mahindra-finance-managing-director-gets-candid-about-the-rights-issue/articleshow/77212386.cms" data-type="tilCustomLink" target="_blank">in an exclusive chat in July 2020</a>. Here’s an excerpt of that interview: <div type="Youtube" id="Qu9KvcNr1iM" title="M&amp;M Financial MD explains how the company is preparing for the worst and hoping for the best" thumbUrl="https://i.ytimg.com/vi/Qu9KvcNr1iM/mqdefault.jpg"></div> For other NBFCs that are eligible to pay dividend, there may be a cap on how much they can dole out based on the benchmarks set by the RBI. These are the likely limits on dividends given the current financial health of the following firms. <table style="border-width: initial; border-style: none; width: 468pt; table-layout: fixed;"></colgroup><tbody><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Company </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Dividend limit </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Bajaj Finance </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Up to 45% </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Cholamandalam Finance </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Up to 30% </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">HDFC </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Up to 45% </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">L&amp;T Finance Holdings </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Up to 25 </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Magma Fincorp </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Up to 25% </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Shriram City Union Finance </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Up to 25% </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Shriram Transport Finance </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Up to 25% </td></tr></tbody></table>Source: Emkay SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/business/corporates/news/the-33-billion-itc-one-of-indias-most-trolled-stock-in-recent-weeks-seems-to-have-turned-a-corner/articleshow/79641456.cms">The $33 billion ITC, one of India’s most-trolled stock in recent weeks, seems to have turned a corner</a><a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/business/corporates/news/the-33-billion-itc-one-of-indias-most-trolled-stock-in-recent-weeks-seems-to-have-turned-a-corner/articleshow/79641456.cms"></a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/careers/news/icertis-helps-google-microsoft-and-apple-manage-their-contracts-is-hiring-for-techies-and-people-in-sales/articleshow/79640659.cms">EXCLUSIVE: This Indian unicorn helping Google, Microsoft and Apple manage their contracts is hiring⁠— it needs techies as well as people in sales</a><a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/careers/news/icertis-helps-google-microsoft-and-apple-manage-their-contracts-is-hiring-for-techies-and-people-in-sales/articleshow/79640659.cms"></a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/business/corporates/news/tata-group-company-voltas-is-telling-analysts-that-it-may-hike-ac-prices-by-3-4-to-cover-rising-input-costs/articleshow/79624340.cms">Voltas is telling analysts that it may hike AC prices by 3-4% to cover rising input costs</a>

How RBI's proposed restrictions may affect your dividends

Mumbai, Apr 17 () Non-bank financial players have welcomed the Reserve Bank of India's decision to provide Rs 50,000 crore of additional liquidity support to the sector by conducting targeted long term repo operations (TLTRO 2.0). Shadow banking players also hope to get more liquidity support from banks after the RBI reduced the reverse repo rate by 25 basis points to 3.75 per cent from 4 per cent. The RBI on Friday said it will conduct (TLTRO 2.0) for an aggregate amount of Rs 50,000 crore, to begin with, in tranches of appropriate sizes.The funds availed by banks under TLTRO 2.0 should be invested in investment grade bonds, commercial paper, and non-convertible debentures of NBFCs, with at least 50 per cent of the total amount availed going to small and mid-sized non-banking financial companies (NBFCs) and micro-finance institutions (MFIs)."It (TLTRO) is a very-very favourable decision. Now, they (RBI) have specifically allotted (liquidity through TLTRO) to NBFCs, of which 50 per cent will be for small and medium NBFCs. It is a great liquidity support from the RBI," Mahindra and Mahindra Financial vice chairman and managing director Ramesh Iyer told . MFIN's CEO Harsh Shrivastava said the microfinance sector is highly appreciative of RBI for acknowledging the industry concerns and for infusing liquidity of Rs 50,000 crore, a substantial part of which will help the small and medium NBFC MFI's to support the bottom of the pyramid customers.In order to encourage banks to deploy their surplus funds in investments and loans in productive sectors of the economy, the RBI reduced the reverse repo rate to 3.75 per cent. Shriram Transport's managing director and CEO Umesh Revankar, said the decision to cut the reverse repo rate by 25 bps will encourage banks to look for lending opportunities. "We would appreciate it if banks reciprocate positively to NBFCs request on moratorium to manage cash flow smoothly," Revankar said.The RBI, on March 27, had permitted all lending institutions (LIs) to grant a moratorium of three months on payment of current dues falling between March 1 and May 31, 2020.On Friday, the RBI said in respect of all accounts for which lending institutions decide to grant moratorium or deferment, and which were standard as on March 1, 2020, the 90-day NPA norm shall exclude the moratorium period,"There would be an asset classification standstill for all such accounts from March 1, 2020 to May 31, 2020," it said.It also allowed NBFC players to extend the date for commencement for commercial operations (DCCO) for loans given commercial real estate by additional one year without considering it as restructuring."The 90 day NPA norm won't be applicable to loans where the moratorium is granted. This along with a one year extension on loans given to the real estate sector will help preserve asset quality," Centrum Group executive chairman Jaspal Bindra said. The central bank announced to provide special refinance facilities for a total amount of Rs 50,000 crore to Nabard, Sidbi and NHB to enable them to meet sectoral credit needs."The special refinance facilities of Rs. 50,000 crore to NHB, Sidbi and Nabard will help meet credit needs of MSME sector and housing finance which has been severely affected by Covid-19," Capri Global Capital's managing director, Rajesh Sharma said. Edelweiss Group chairman and CEO Rashesh Shah said RBI has shown its commitment to go the extra mile and more stimulus measures will help in reviving the financial sector. Tourism Finance Corporation of India (TFCI) managing director and CEO Anirban Chakraborty said the RBI's announcement brings much needed relief to the sectors with an eye on the developing situation at the ground level. HV MKJ

NBFCs hail RBI's additional liquidity support move to tide through Covid crisis

Mumbai, Jan 28 () Non-banking finance companies (NBFCs) have sought setting up of a permanent refinance window for the sector in the Union Budget, which they say will help them diversify their funding sources.
 The shadow banking players have also asked for allowing NBFCs with strong support from their parents to access public deposits.
 Finance Minister Nirmala Sitharaman is scheduled to present the Budget for financial year 2020-21 on February 1.
 Banks have been reluctant to lend to the NBFC sector after a series of default by Infrastructure Leasing and Financial Services (IL&amp;FS) in September 2018.
 This risk averse approach of banks created a liquidity crunch for the entire NBFC sector which in turn had a multiplier effect on the important sector like automobiles, micro, small and medium enterprises (MSMEs) and consumer goods.
 "The need of the hour is to develop funding sources for NBFCs outside the banking system. A dedicated refinance window for NBFCs, has been a long-standing demand of the NBFC sector," Finance Industry Development Council (FIDC) chairman Ramesh Iyer said in a pre-budget memorandum submitted to Sitharaman.
 FIDC is a representative body of asset and loan financing NBFCs.
 It also proposed that NBFCs should be allowed an on-tap facility for issuance of non-convertible debentures (NCDs) to the retail market.
 The offering of these bonds should be through an easy- to-operate and less costly procedure, but with proper governance to provide investor protection and comfort, it said.
 According to Tata Capital's managing director and CEO Rajiv Sabharwal, "NBFCs with a strong parentage should be allowed to access public deposits as it will help credit growth and diversify the borrowing profile of NBFCs."
 He said reviving stalled projects, regulating consultative mechanism of the RBI and treating NBFCs at par with banks with respect to Sarfaesi and amendments to rules relating to external commercial borrowings are some other reforms that the government can bring in to accelerate the growth of the sector.
 Muthoot Finance's managing director George A Muthoot said banks are currently extending credit to top-rated NBFCs only, and medium-rated are finding it difficult to get funds.
 "To spur the economy, the government should announce some measures for banks to be liberal with lending to NBFCs," Muthoot said.
 Shriram Transport Finance managing director Umesh Revankar said he expects the government to announce more prudent policies which are customer centric to revive the consumer demand in the economy.
 "There should be special tax incentives for homebuyers to revive the real estate demand," he said.
 Revankar said the NBFC players who are predominantly into financing priority sector should be given more scope in priority sector lending target of banks.
 Talking about the scrappage policy to revive the auto sector, Revankar said people who voluntarily scrap their vehicle should be given a credit note which is transferable/exchangeable so that any customer can use the same while buying the new vehicle.
 Aadhar Housing Finance's managing director and CEO, Deo Shankar Tripathi, said the budget is expected to consider few more measures for quick revival of overall sector and restoration of confidence in NBFC/ housing finance companies.
 "In the last fiscal budget, tax exemption on home loan interest was increased from Rs 2 lakh to Rs 3.50 lakh for loans up to Rs 45 lakh availed by March 2020. This may be extended for next 5 years without ceiling of Rs 45 lakh," Tripathi said. HV MKJ

You Searched For "Ramesh Iyer" and got 8 results

EXCLUSIVE: M&M Financial Managing Director gets candid about the rights issue, the bleak prospects for this year and why there should be no more loan moratorium

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NBFCs seek one-time restructuring for standard accounts that may default in future

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Manulife picks 49pc stake in Mahindra AMC for Rs 265 cr

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The market mood around these seven stocks has suddenly changed ⁠— here's why

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Global financial services major Manulife enters India in a joint venture with Mahindra Finance

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How RBI's proposed restrictions may affect your dividends

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NBFCs hail RBI's additional liquidity support move to tide through Covid crisis

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NBFCs seek setting up of permanent refinance window in Union Budget

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