• Deccan Chronicle
  • Andhra Bhoomi
  • Asian Age
  • ePaper
  •  Auto Refresh
Home

ePaper
Last Updated:05:38 PM IST | Wednesday, Feb 01, 2023
  • Home
  • Politics, Plan And Policy
  • Markets
  • Companies
  • Economy
  • In Other News
  • Autos
  • Just In
Menu
  • Home
  • Politics, Plan And Policy
  • Markets
  • Companies
  • Economy
  • In Other News
  • Autos
  • Just In
Home > Economy > Growth reaches a trough; to start improving by Jan: Aditya Puri
Economy
Growth reaches a trough; to start improving by Jan: Aditya Puri
By  
PTI   , Published : Oct 6, 2019, 6:25 pm IST | Updated : Oct 6, 2019, 6:25 pm IST

A few companies, especially with exposure to the realty space, may face problems in the future, said HDFC's Aditya Puri.

I am not saying boisterous or we are going to have a runaway boom. I am saying that as we are moving ahead, growth will move higher from where it is. We are probably at the trough, Puri said. (Photo: File)
I am not saying boisterous or we are going to have a runaway boom. I am saying that as we are moving ahead, growth will move higher from where it is. We are probably at the trough, Puri said. (Photo: File)

Mumbai: Economic growth has probably reached a ?trough? and the pace of GDP expansion will start rising by January next year, HDFC Bank managing director Aditya Puri has said.

While the crisis with the shadow banks is over, there may be a few companies, especially with exposure to the realty space, that may face problems in the future, Puri told PTI in an interview.

The comments were made at an interaction before the RBI sharply revised down its GDP growth target to 6.1 per cent on Friday. The GDP growth has slipped to a six-year low of 5 per cent in the June quarter.

"I am not saying boisterous? or we are going to have a runaway boom. I am saying that as we are moving ahead, growth will move higher from where it is. We are probably at the trough,? Puri said.

He said higher government spending, investment in infrastructure, Finance Minister Nirmala Sitharaman's move to get more money into the economy and a good monsoon will support the growth.

However, given the very large size of India, the measures will take time to yield results, Puri said, adding that by January, he expects a pick-up in the economic growth.

Banks are witnessing demand for working capital loans at present, he said, adding that the capacity utilisation needs to move up to 80 per cent from the present 77 per cent for investments to happen and it may take some time for the same.

Replying to a query on the fiscal side worries, Puri said while it is ?reasonable? to expect a widening of the fiscal gap, he is confident that the same can be bridged through higher disinvestments, better collections of both GST and the income tax, and not worry too much about a marginal slippage.

On the issues surrounding the NBFCs (non-banking finance companies), he said the crisis is gone, but there is no easy solution and things will take time to settle down.

There may be a few more entities especially having exposure to the realty segment, which will face difficulties, he said, answering a question on recent developments at Altico Capital.

?The crisis is over, the problem is not over. There will be a few like these. The ALM issue will have to be rectified. I don't think there are any unrecognized large NBFCs which will move into a problem,? he said.

Stressing that an NBFC going down does not create systemic risks because such entities are not a part of the clearing system, he welcomed efforts like portfolio sell-offs, bringing equity and improvements in cashflows.

The RBI has also taken measures to help the sector and the state-run banks have also started lending, he said, adding that we need to keep monitoring the sector in the future.

On HDFC Bank's plans, he said it will very well capitalised and will not be needing capital for at least three more years.

?We are seeing growth in demand,? he said, adding that the bank has started lending to newer segments like the small businesses, and even shopkeepers because of technology tools.

It has started to go beyond the top 4 million consumers in the country and is now addressing the top 6.5 million consumers courtesy the data it has and also through targeted marketing efforts, he said.

He said the quality of its unsecured book is also ?quite safe? and the bank expects this stream to continue growing.

On the term loans side, Puri said the bank has participated in road and renewable energy projects, and stressed the need to have ?good projects? for this to grow.

He defined a ?good project? as one ?where appropriate risks are covered, the construction risk is covered, the owner who was supposed to make payment has been covered and the structuring is such that debt to equity is correct? and assured that such will continue getting money.

end-of
Tags: 
aditya puri, hdfc bank, gdp growth, economy, nirmala sitharaman, gst
Location: 
India, Maharashtra, Mumbai (Bombay)
Latest From Economy
Former RBI governor Urjit Patel has written a book titled Overdraft: Saving the Indian Saver.

Urjit Patel: Why our banks aren't saviours of the Indian saver

FIEO Director General Ajay Sahai said the global situation is likely to improve in the first half of 2020, which would have a positive impact on India's exports.

Exports to rebound in 2020 but growth to remain subdued

ICRA Economist Aditi Nayar expects moderation in vegetable prices to a large extent by early 2020. (Photo: File)

Inflation leaves consumers teary-eyed as pricey onions, food items bite

Most Popular

Mukesh Ambani 9th richest on Forbes' real-time billionaires list
Top credit card myths harmful for your financial well-being
Microsoft CEO Satya Nadella tops Fortune's Businessperson of the Year 2019
Employment growth slowed down in last two years: report
GST structure: key challenges and its solutions

Editor's Picks

Income tax e-filers drop by over 6.6 lakh in FY19: Official data
Swiping on your smartphone reveals a lot about you to your social media company
  • Read Financial Chronicle as it appears in print.
  • Subscribe, and get it delivered in the inbox everyday.
  • Politics, Plan And Policy
  • Markets
  • Companies
  • Economy
  • In Other News
  • Autos
  • Just In
  • Home
  • About Us
  • Contact Us
  • Terms of Service
  • Privacy Guidelines
  • Copyright © 2019 Financial Chronicle, All rights reserved
Developed & Maintained By Daksham