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See rate cut post Budget; lower lending rate in ’15: HDFC

According to Keki Mistry of HDFC, though inflation is low, RBI will wait for the Budget – see the fiscal deficit number and the Budget fineprint – before lowering rates. Lower rates, in turn, may lead to a pick up in housing loan demand in metros, he adds.

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With 70 percent of its lending coming from the individual segment, Keki Mistry, vice-chairman and CEO,  HDFC says there was no decline in lending over the past three years despite economic slowdown. However, non-individual segment lending saw slowdown over the same period. But on the brighter side, there has been a mild pick-up in incremental lending in the last few months on the non-individual side, he adds.

According to him, though inflation is low, the Reserve Bank of India will wait for the Budget – see the fiscal deficit number and the Budget fineprint – before lowering rates. Lower rates, in turn, may lead to a pick up in housing loan demand in metros, says Mistry, while adding that growth has mainly been coming from tier II and tier III cities.

He also sees the cost of money coming down in the coming quarters. 2015, according to him, will also see lower borrowing and hence lower lending rates.

On the recent insurance ordinance, he believes FIIs do not need to wait for the actual Bill to be passed for putting in money as the ruling party may just call for a joint session of the Parliament in case of hurdles and pass the Bill.

However, he does not see too many insurance companies needing capital. “HDFC’s insurance arm doesn’t need capital now unless it goes in for acquisitions,” says Mistry.

Stay tuned for more…

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