Icra revises AUM growth outlook for retail NBFCs to 5-7% in FY22
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Domestic rating agency Icra Ratings said that it has revised the asset under management (AUM) growth outlook of retail non-banking financial companies (NBFCs) to 5-7 per cent for the current fiscal (FY22) from an earlier expectation of 8-10 per cent. In the first half of FY22, retail NBFCs grew by less than one per cent.
The agency said the growth outlook would be exposed to downside risk in case of significant disruptions caused by the new wave of infections in Q4 FY22. At present, while the infections rates remain high, the operational disruptions have been quite limited.
The agency's Vice President (financial sector ratings) A M Karthik said ‘apart from the various regulatory changes over the last 3-4 months (such as scale-based regulations, prompt corrective action framework etc) and a muted H1 FY22, we note that some of the key segments of retail-NBFCs, especially vehicle finance, are faced with supply-side constraints, which could pull-down growth vis a vis our expectation, even if the demand remains less impacted by the new wave of infections.’
