CRISIL NBFC Report

CRISIL Research has conducted a deep-dive analysis to arrive at its opinion on the growth
prospects, competitive scenario and attractiveness of different segments within the NBFC
space. The report seeks to answer questions such as:

Have the non-performing assets of NBFCs peaked?

Will NBFCs see an improvement in AUM growth?
In terms of competition, how is the scenario for NBFCs in each segment likely to
change?
How will changing regulations impact the asset quality and profitability of NBFCs?
Will sectors such as housing finance, microfinance and unsecured business loans
continue to perform well?

Segments covered
1. Infrastructure finance

3. Loan against property

5. Construction equipment finance
7. Gold loan

2. Housing finance
4. Auto finance (including used cars & CVs)
6. Microfinance
8. Unsecured small business loan

Coverage of the report in brief

Overview

For each of the six segments

Structure and classification of NBFCs

Share of NBFCs in systemic credit
Regulatory environment for NBFCs
Competitive positioning of NBFCs across
key segments
Relative attractiveness of various NBFC
segments based on growth and
profitability outlook
Current and projected asset class-wise
distribution of NBFC segments

Overall growth in the industry

Market share of banks vs. NBFCs
Growth outlook for NBFCs
Profitability of NBFCs - review & outlook
Asset quality - review & outlook
Underlying asset dynamics
Regulations
Key growth drivers and challenges
Player profiles

Continued

NBFC Report

Detailed Table of Contents

Infrastructure Financing
Opinion
Outstanding portfolio growth and market dynamics

Review of growth in overall infrastructure financing market

 Growth in infrastructure projects sanctioned by financial institutions
 Segment wise share of investments
Market share of NBFCs vs. Banks including outlook
 Infrastructure finance portfolio mix of banks and NBFCs
 Infrastructure finance portfolio mix for NBFC (excluding PFC and REC)
Growth outlook for NBFCs
Player wise market share of NBFCs

Profitability

Borrowing profile for overall NBFCs and for NBFCs excluding PFC and REC
Profitability - for overall NBFCs and for NBFCs excluding PFC and REC
Capital adequacy

Asset quality

Past trend in Gross NPAs and restructured assets

Outlook on GNPAs

Industry Information
Underlying asset dynamics
Regulatory framework
Key growth drivers and risks in the finance market

NBFC Report

Housing finance
Opinion
Outstanding portfolio growth and market dynamics

Review of housing finance market growth

Brief analysis on real estate markets in top 10 cities
Growth outlook for HFCs
Analysis of large HFCs vis--vis small and medium sized HFCs
Brief analysis of low cost housing finance industry and key players
Market share of HFCs vs. Banks including outlook
Key competencies which will help HFCs sustain business growth despite
competition from banks
Breakup of HFC portfolio (Retail housing loans, Non-Retail)
Indicative yields and GNPAs across segments
Segment wise key parameters like Penetration, LTV, Tenure, ATS
Player wise market share of HFCs

Profitability

Borrowing profile of HFCs

Profitability of HFCs
Detailed analysis of profitability of large HFCs vis--vis small and medium sized
HFCs
 Difference in customer profile of large HFCs vis--vis small and medium sized
HFCs
Profitability- Retail housing loans and non-retail segment
Capital adequacy

Asset quality

Past trend in Gross NPAs

Outlook on GNPAs

Industry Information
Underlying asset dynamics and demand drivers
Regulatory framework
Key growth drivers and risks in the finance market

NBFC Report

Loan Against property

Opinion
Outstanding portfolio growth and market dynamics

Review of LAP market growth

Outlook for LAP market growth
Key drivers for growth
Trend in share of tier II cities
Market share of Non-banks vs. Banks including outlook
Business sourcing mix for NBFCs
Business models for Non-banks, Private sector banks and public sector banks
Profile of the Non-bank customers
Share of collateralized properties for Non-banks
Key market parameters (Interest rates, loan to vale, average ticket size, tenure)
Key risks involved while providing LAP

Profitability
Asset quality

Past trend in Gross NPAs

Outlook on GNPAs

NBFC Report

Auto Finance
Opinion
Outstanding portfolio growth and market dynamics - overall Auto finance

Underlying asset growth outlook

Growth outlook for NBFCs (including Segment wise growth expectations for new
vehicle sales)
Market share of NBFCs vs. Banks including outlook
Player wise market share of NBFCs
Breakup of NBFC portfolio
Indicative yields and GNPAs across segments
Segment wise key parameters like Penetration, LTV, Tenure, ATS

Profitability overall Auto finance

Borrowing profile
Profitability
Capital adequacy

Asset quality overall Auto finance

Past trend in Gross NPAs

Outlook on GNPAs

Tractor finance

Past disbursement growth

Share in disbursements for NBFCs, private sector banks and others
Key competencies which will help NBFCs sustain business growth despite
competition from banks
Disbursement growth outlook
Key market parameters (Loan to value, finance penetration)
Profitability
Asset quality

Used CV finance market

Past disbursement growth

Disbursement growth outlook LCV and MHCV separate calls
Share in disbursements for NBFCs vs Banks
Key market parameters (Finance penetration, risk profile, interest rate, loan to
value ratio)
NBFC Report

Key success factors for used CV finance business

Profitability
Asset quality

Used car finance market

Past disbursement growth

Disbursement growth outlook
Share in disbursements for NBFCs vs Banks
Key parameters on which players compete
Profitability
Asset quality

Industry Information Overall Auto finance

Underlying asset dynamics and demand drivers
Evolution
Regulatory framework
Key growth drivers and challenges in the finance market

NBFC Report

Construction equipment loans

Opinion
Disbursement growth and market dynamics

Growth in disbursements Review and outlook

Organised vs unorganized segment
Finance penetration
Market share of NBFCs vs Banks
Growth outlook for NBFC Assets under management
Player wise market share of NBFCs
Breakup of NBFC portfolio (new vs used; Contractor vs. Hirer/Rental)

Profitability

Borrowing profile
Profitability

Asset quality

Past trend in Gross NPAs

Outlook on GNPAs

Industry Information
Underlying asset dynamics and demand drivers
Regulatory framework
Key success factors and challenges in the finance market

NBFC Report

Unsecured Small business loans

Opinion
Disbursement growth and market dynamics

Current market size and past growth

Market share of NBFCs vs. Banks including outlook
Growth outlook for NBFCs
Channels for sourcing business (proportion, commission paid)
Key competencies which will help NBFCs sustain business growth despite
competition from banks
Customer profile
Key parameters like Tenure, ATS etc.

Profitability

Profitability of NBFCs
Profitability of Banks

Asset quality

Past trend in GNPAs

Outlook on GNPAs

NBFC Report

Gold Loan
Opinion
Outstanding portfolio growth and market dynamics

Review of the gold loan market

Impact of Gold monetisation scheme announced in the latest budget
Growth outlook for NBFCs
Market share of NBFCs vs. Banks including outlook
Key competencies which will help NBFCs sustain business growth despite
competition from banks
Region wise breakup of NBFC portfolio
Player wise market share of NBFCs

Profitability

Borrowing profile, securitisation trend

Profitability
Capital adequacy

Asset quality

Past trend in Gross NPAs

Outlook on GNPAs
Sensitivity of gold prices and LTV on probability of default

Industry Information
Underlying asset dynamics and demand drivers
Features of gold loans (Interest rate, tenure, LTV, ATS), comparison with personal
Loan
Regulatory framework
Key growth drivers and risks in the finance market

NBFC Report

Micro finance
Opinion
Outstanding portfolio growth and market dynamics

Review of AUM growth for MFIs

 Growth in ticket size and number of clients
Growth outlook for MFIs
Market share of MFIs vs. Banks including outlook
Key trend of MFIs and Bank portfolio (Average ticket size, GNPAs)
Impact of small bank licenses on the MFIs
Player wise market share of MFIs
State wise split of MFI AUM and client base
State wise portfolio growth of MFIs
Urban rural client mix of MFIs
Proportion of loans given for income generation vs consumption
Private equity investments in the sector

Profitability

Borrowing profile and impact of MUDRA bank

Trend in securitization
Profitability
Difference in profitability of small and large players
Key parameters for players which have undergone corporate debt restructuring

Asset quality

Past trend in Gross NPAs

Outlook on GNPAs

Industry Information
Evolution of the industry
Business models
Regulatory framework
Key growth drivers and risks in the finance market

NBFC Report

Player Profile for All Segments Covered

Infrastructure Financing
IFCI Ltd
IL&FS Financial Services Ltd
India Infrastructure Finance Company Ltd

Power Finance Corporation Ltd

Rural Electrification Corporation Ltd

Housing finance
Can Finance Homes Ltd
Cent Bank Home Finance Ltd
Dewan Housing Finance Corporation Limited
DHFL Vysya Housing Finance Limited
GIC Housing Finance Limited
Gruh Finance Ltd
HDB Financial Services Ltd
Housing Development Finance Corporation
Ltd
Indiabulls Housing Finance Ltd (Consolidated)
L&T Housing Finance Ltd

LIC Housing Finance Limited

Mahindra Rural Housing Finance Ltd
PNB Housing Finance Limited
Repco Home Finance Ltd
Sahara Housingfina Corporation Ltd
Shriram Housing Finance Ltd
SRG Housing Finance Ltd
Sundaram BNP Paribas Home Finance Ltd
Tata Capital Housing Finance Ltd

Auto Loans
AU Financiers (India) Ltd
BMW India Financial Services Private Limited
Cholamandalam Investment & Finance Co Ltd
Equitas Finance Pvt Ltd
Hero Fincorp Ltd
Kotak Mahindra Prime Ltd
L&T Finance Ltd
Magma Fincorp Ltd

Mahindra & Mahindra Financial Services Ltd

Muthoot Capital Services Ltd
Shriram Transport Finance Co Ltd
Sundaram Finance Ltd
Tata Motors Finance Ltd
TVS Credit Services Limited
Toyota Financial Services India Ltd

Construction equipment loans

Shriram Equipment Finance Ltd

SREI BNP Paribas

NBFC Report

Gold Loan
Manappuram Finance Ltd
Muthoot Finance Ltd

Muthoot Fincorp Ltd

Micro finance
Asirvad Microfinance Pvt Ltd
Bandhan Financial Services Pvt Ltd
Cashpor Micro Credit
Equitas Microfinance India Pvt Ltd
Grama Vidiyal Microfinance Pvt Ltd

Grameen Financial Services Pvt Ltd

Madura Micro Finance Ltd
SKS Microfinance Ltd
SMILE Microfinance Ltd
Ujjivan Financial Services Pvt Ltd

Diversified business
Bajaj Finance Ltd
Capital First Ltd
Edelweiss Financial Services Ltd
Fullerton India Credit Company Ltd
India Infoline Ltd - Consolidated
MAS Financial Services Ltd

Rabo India Finance Limited

Reliance Capital Ltd
Reliance Commercial Finance
Religare Finvest Ltd
Shriram City Union Finance Ltd

NBFC Report