Jefferies believes the final RBI gold loan guidelines have relaxed some of the tighter norms proposed earlier in the draft and will ease concerns around growth and operating costs for gold loan financiers.
Key changes highlighted by Jefferies include:
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A tiered Loan-to-Value (LTV) cap, with 85 percent LTV (including accrued interest) allowed for consumption loans under ₹2.5 lakh, compared to the uniform 75 percent cap proposed earlier.
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No credit appraisal required for loans ≤ ₹2.5 lakh.
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The previously proposed end-use monitoring clause has been dropped.
Jefferies said these relaxations should ease growth concerns and reduce incremental opex burdens on gold financiers.
Among the listed players, Jefferies continues to prefer Muthoot Finance as its top pick in the segment.
Disclaimer: The views and target prices mentioned in this article are as stated by Jefferies. They do not represent the opinions or recommendations of this publication. Readers are advised to consult their financial advisors before making any investment decisions.
