NBFCs zoom on banking license hopes; IFCI, IDFC hits yr high

Shares of non-banking finance companies (NBFCs), including IFCI and IDFC, which are reported to be mulling to enter the banking space, today touched their respective year highs in the early session on the Bombay Stock Exchange.

The Reserve Bank of India, today, will meet the industry chambers, including Indian Banks' Association (IBA) and CII in Mumbai to discuss modalities for granting new banking licences to business houses and non-banking finance companies.

In August, the apex bank RBI had announced discussion paper on new banking licences and regulations for the same to foster greater competition.
    
NBFCs are financial institutions that provide banking services without meeting the legal definition of a bank.
    
In the hopes of getting the banking license, shares of IFCI zoomed upto 5.58 per cent to a 52-week peak of Rs 71.80. Similarly, IDFC also rose as much as 3.92 per cent to its year high of Rs 213.25.
    
"The rise in the stocks clearly indicates that the market is very excited about this move, as there are huge amount of opportunities for the NBFCs if they succeed in getting banking licences," Unicon Financial Services CEO Gajendra Nagpal said.
    
Besides IDFC and IFCI, shares of various entities like Reliance Capital, IndiaBulls, Religare, IL&FS and Aditya Birla Financial Services also saw smart gains in the start of the session on speculations of the entities seeking banking licences.
    
Anil Ambani-led Reliance Capital shares started the day on a strong note and gained over two per cent to touch a month-high level of Rs 874.80.
    
A gain of 4.78 per cent was seen in the shares of Religare while Aditya Birla Nuvo advanced by 1.86 per cent. IL&FS also increased by nearly one per cent in the morning session.