Stocks of non-banking financial companies (NBFCs), which have been rallying for some time now, lost some ground on Tuesday, a day after the Reserve Bank of India....
Stocks of non-banking financial companies (NBFCs), which have been rallying for some time now, lost some ground on Tuesday, a day after the Reserve Bank of India (RBI) issued final guidelines for ‘on tap’ universal banking licences. Share prices of 6 of a clutch of 10 NBFCs fell during the session.
Shares of Bharat Financial Inclusion closed at Rs 822 on Tuesday a fall of 9.73% from its close of Rs 910 on Monday. Shares of IIFL and Bajaj Finserv lost 4 and 3% respectively in Tuesday’s trade. However, stocks of Manappuram Finance and India Bulls Housing Finance posted a 2% gain each.
According to RBI guidelines, NBFCs that belong to a group with total assets or gross income of Rs 5,000 crore or more and which have non-financial businesses accounting for more than 40% of the total assets or gross income cannot apply for a banking licence. However, large conglomerates can invest up to 10% in these companies. The shares of Bajaj Finserv, part of the Bajaj group fell by 3% and closed at Rs 2,727.
The guidelines further said resident individuals and professionals having 10 or more years of experience in banking at a senior level are allowed to promote universal banks.