New Delhi: Non-banking finance companies, or NBFCs, are yet to benefit from rate cuts announced by the banking regulator in June, and the policy transmission may take up to six months, Anoop Bali, managing director of Tourism Finance Corporation Ltd, told ET.
The firm plans to raise ₹800 crore this fiscal year and expects its borrowing cost to come down to 9-9.25% from the existing 9.6%.
“Besides the repo, there is also the CRR cut. So, I think this will happen over a time in the next 3-6 months,” he said. The RBI, in its June monetary policy review, decided to cut the Cash Reserve Ratio (CRR) by 100 bps in four equal tranches of 25 bps each. However, the policy repo rate was reduced by 50 basis points (bps) to 5.50% with immediate effect.
TFCL plans to raise around ₹200 crore through NCDs and the remainder through bank borrowings and further diversify its lending portfolio.
Bali said that the rate reduction on existing loans is taking time, but new lending is happening at revised rates.
“If we are able to get better interest rates, we plan to go for a long-term NCD. It is a 5-year paper we are looking at. We are in discussion with our credit rating agencies to review our credit rating. We feel that we have performed exceedingly well the last fiscal year, and the trend is continuing, so we expect that our credit agencies will give that a consideration,” he said.
Bali noted that the firm is exploring new areas of lending, including solar finance, lending to housing finance companies, and loans against securities.
“Our current exposure towards the hospitality and tourism sector is around 65%, but now we plan to bring it to 50% by FY27,” he said.
