Gold loan providers surge on RBI report proposals
Reuters Market Eye - Shares in gold loan providers such as Manappuram Finance soar after an RBI report proposed increasing the loan-to-value, or LTV, ratio to 75 percent from 60 percent currently.
The ratio is an important tool that can vary the quantity of gold loans which a company can provide to customers.
"The proposals to increase LTV and to use cheques for high-value transactions are positive, but a cap on lending rates and restrictions on NCD (non-convertible debentures) will affect gold-loan NBFCs' profitability," Kotak Securities said in a note.
Muthoot Finance shares up 9 percent, while Manappuram Finance (MNFL.NS) rises 16 percent.
Shares in Titan Industries, which makes gold jewellery, are down 1 percent on concerns over rising costs after the government says it will make importing gold costlier.
- Tweet this
- Share this
- Digg this
The Congress party was headed for a bruising defeat in key state elections, including in the capital, early results showed on Sunday, underlining the struggle it will face to cling to power in a national election due by May. Full Article