India Ratings maintains stable rating outlook for NBFCs in FY23

MUMBAI :

India Ratings and Research on Friday maintained a neutral sector outlook and a stable rating outlook for non-banking finance companies (NBFCs) in FY23.

It believes that FY23, in absence of any negative event, would see normalization of business activities, after facing challenges in the past few years following the default by Infrastructure Leasing and Financial Services Ltd leading to liquidity challenges and then the covid-19 pandemic.

“NBFCs would begin the year with sufficient capital buffers, stable margins and sizeable on-balance sheet provisioning, while adequate system liquidity would aid funding. Nevertheless, an expected increase in systemic interest rates and asset quality issues in some segments due to the lagged impact of pandemic would be a drag on the operating performance,” it said.

The sector, the rating agency said, has been facing increased regulatory oversight and push…

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