-
Collection efficiency is more relevant in Microfinance, SFB, NBFC business models and not in large retail banks/corporate banks. There is no standard parameters for collection efficiency but we have to see the y-ooy/q-o-q collection % as declared in results. In some financial stocks, there might be collection from GNPA as well and collection can exceed 100%. Ideally 99-100% should be normal in a good macro scenario and many times in the small finance/micro finance there is delays in payment of EMI. So you should see overall collection efficiency alongwith GNPA formation, fresh slippages.
-
For evergreening, you have to trust the professional Management. In banks there is no promoter generally and most of the shareholding is with FII/DII which have much stronger analysis teams and do their own Fraud accounting as well. Generally all the present banks/NBFC are highly regulated with frequent RBI Audits and with new Expected credit loss guidelines, you will appreciate that Indian financial sector (Pvt) is strongest globally. Compare with US and China Banks.
| Subscribe To Our Free Newsletter |
