JULY 20248TOP STORIESRETAIL SECURITIZATION MARKET DOWN BY 13 PERCENT COMPARED TO PREVIOUS YEARAccording to CARE Ratings, the retail asset securitization market contracted by around 13 percent year-on-year to Rs 48,000 crore in the June quarter, down from Rs 55,000 crore in the same period last year. The primary reason for the decline is the excess liquidity available with originators.Despite this contraction, high credit growth, originators' efforts to diversify their funding sources, increased investor demand for retail Priority Sector Lending (PSL) assets, and confidence in the performance of rated transactions--reinforced by their stability during the pandemic--have contributed to the volume of retail asset securitization transactions. Direct assignment (DA) transactions and pass-through certificates (PTC) accounted for almost equal proportions, similar to the trend observed in the latter half of the previous fiscal year. The split between DA and PTC transactions, which had previously favored DAs, has shifted in recent times.ABS pools constituted a significant share of around 82 percent of total PTC issuances, followed by MBS and MFI pools, contributing close to 10 percent and 8 percent, respectively. The proportion of MFI transactions as a part of PTC issuances also declined from 12 percent in Q1FY24. Vehicle loan financing (including pools backed by loans against commercial vehicles, cars, two-wheelers, construction equipment, tractors, etc.) accounted for around Rs 16,200 crore (67 percent of PTC issuance).CARE Ratings noted that the prediction of above-average rainfall in 2024 by the IMD is favorable for a revival in rural consumption demand. Along with a healthy projected credit growth of 14 percent-14.5 percent and increasing demand for PSL assets, the Indian securitization market is likely to exhibit strong volumes in FY25. JSW MG MOTOR & SHELL INDIA TEAM UP FOR EV CHARGING INFRAJSW MG Motor India stated that it has partnered with Shell India to improve the nation's public charging infrastructure for electric vehicles. Customers of JSW MG Motor India will be able to use Shell's extensive nationwide network of fuel stations for vehicle charging as a result of the partnership.JSW MG Motor stated in a statement that Shell India will deploy CCS 50kW and 60kW DC fast chargers at several locations throughout India in accordance with the Memorandum of Understanding (MoU). This will strengthen the EV charging network and make it easier for EV users to travel long distances."Our partnership with Shell India highlights our shared commitment to sustainable mobility and will help accelerate EV adoption across the country," JSW MG Motor India Chief Growth Officer Gaurav Gupta said.He added that the expansion of infrastructure will enable EV customers to plan hassle-free long-distance journeys and make EV fast-charging more accessible and convenient. Sanjay Varkey, director of Shell India Markets, stated that the partnership intends to leverage digital integration and customer-centric initiatives to encourage widespread adoption of electric vehicles in the nation.India's automotive manufacturer, JSW MG Motor India which was formerly MG Motor India Private Limited until 2024, was established in 2019. It has been a joint venture since 2023 between the Indian multinational conglomerate JSW Group, based in Mumbai, and the Chinese automaker SAIC Motor, based in Shanghai. SAIC Motor is a Chinese state-owned automaker that sells cars under the British MG marque.
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