I expect a serious correction in the market ,particularly financial stocks ( lenders like Banks and NBFCs ) after the NPAs comeout in public in quarter ending Dec 2020 or March 2021 results. So far these NPAs are hidden due to loan moratorium and Court's ruling about recognising the overdues as NPAs....I expect a knee jerk reaction in financials. Some public sector banks could have large NPAs.
Strong private sector banks and NBFCs have already provided for such NPAs without waiting for the NPA recognition and they have increased their Tier-1 capital in Covid period so they will be in much better position to absorb the NPA hits......
After the correction, then strong lenders will grab market share from weak banks and NBFCs...so it will be a fantastic opportunity to buy if we get a serious correction in financials due to this NPA recognition.......waiting for such an opportunity.It will be very interesting to see how this plays out.
Smart_trade
Strong private sector banks and NBFCs have already provided for such NPAs without waiting for the NPA recognition and they have increased their Tier-1 capital in Covid period so they will be in much better position to absorb the NPA hits......
After the correction, then strong lenders will grab market share from weak banks and NBFCs...so it will be a fantastic opportunity to buy if we get a serious correction in financials due to this NPA recognition.......waiting for such an opportunity.It will be very interesting to see how this plays out.
Smart_trade