Poonawalla Fincorp reiterates guidance after a record breaking quarter

Poonawalla's confidence stands out given the pervasive fears in the market about the shrinking profit margin for lenders, big or small.

Shares of HDFC Bank, one of India's biggest banks, had its worst fall in three years after its latest earnings showed that the banking giant made less money on new loans; lesser than what the investors had anticipated.

“For one to two quarters, maybe liquidity will be tight in the market. So we don’t see a major impact,” Bhutada said. The company's net interest margin was up 33 basis points in the latest December quarter.

For a non-banking financier (NBFC) like Poonawalla, the cost of funds would be more expensive due to a recent RBI mandate assigning higher risk weights on unsecured loans. "We don’t see any impact of this RBI circular - we are getting advantage. Because of this lot of players are not able to raise the funds. There is opportunity and we lend to only above ₹50,000 ticket size and the major impact is for the smaller ticket size – those who are lending below ₹ 50,000," he explained.

Shares of Poonawalla Fincorp (market capitalisation of over ₹38,000 crore as on January 19) have gained over 11% in the last one month.