With uncertainty around jobs and restriction in movements, buying real-estate is the last thing on a customer's mind. It's a double whammy for housing finance companies that were already grappling with asset-liability mismatch and liquidity crunch issues post the IL&FS crisis.
Post-crisis, many NBFCs went into self-correction mode, reduced their short borrowings and disciplined their leverage and ALM mismatch. Companies like HDFC and Canfin Homes appear better placed to endure this tough phase, while PNB housing and LIC Housing Finance can face some pressure due to the higher leverage on their books.
From an asset quality perspective, HDFC, LIC HF and CanFin derive sizable business from government employees & category 'A' salaried segment and remain relatively safe investment avenues. On the other hand, the highest impact will be felt on the self-employed segment. Repco and Aavas Housing have most of their exposure in this segment.
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