Over the past few years, a section of the vast Indian middle class has reined in spending on non-essentials, amid high inflation and many have been buying consumergoods on credit. One of the key drivers of consumption are unsecured loans that do not require any collateral. The world of unsecured lending has attracted the attention of the Reserve Bank of India and it has been advised to the NBFCs and HFCs to remain alert in terms of granting consumer credits. Retail loans in the Indian banking sector grew at a compounded annual growth rate of 24.8% between March 2021 and March 2023. Banks unsecured loan portfolio amounted to Rs. 12 lakh crores as on July 2023. Delinquency rates in case of unsecured loans are not very high, however, responsible lending, continuous portfolio monitoring and controlling concentration risk is essential for sustaining the growth momentum of retails/unsecured loans. Digital and information-oriented lending are fuelling the growth of retail credit, especially unsecured loans. Growing debts and lagging income growth could pose a matter of concern as repayment obligations have been on the rise in the recent times with income levels not picking up at the same pace. Indcap Advisors has been instrumental in channelising loans (whether secured or unsecured) for its clients and fuelling their growth. We have in place an efficient time who will hear you out and advise on the best possible source of funding for your organisation keeping in mind the liquidity health of your business. Source: Picture – Image Source 1: Google.com Data –

Fractional shares are partial shares of a company’s stock, allowing investors to purchase a portion of a unit of stock rather than a whole unit. This allows individuals with limited capital to participate in the stock market. Fractional shares/ownership has gained traction in the US Markets but unlike the US, India is in its nascent stages of fractional investing, still at the helm of regulatory scrutiny. However, India should be no exception to this groundbreaking concept of fractional shares and in order to promote the growth of fractional ownership in India, a clear and tailored regulatory framework is essential to address the unique challenges of fractional ownership while ensuring investor protection and market integrity at all times. To make fractional ownership a success, it is pertinent to educate investors in Indiaabout the advantages and risks of fractional ownership for informed decision-making and building confidence. Simultaneously, brokerage firms should also be encourage to adopt practices through collaborations with depositories and other innovative technologies. In this evolving investment landscape, we at Indcap Advisors Pvt. Ltd. as SEBI registered category I Merchant Banker could be your single point solution for all your capital markets and capital raising needs. Source: Picture – Image Source 1: Google.com Data –

India has always been a HubSpot for emerging businesses and investments and the availability of diverse forms of capital is an important part of the modern capital stack for any business. There has been an extraordinary surge in the number of startups in in India and the emergence of unicorns, however it is still seen that the founders face ongoing challenges in securing funding. At this point, it seems that it is very critical for founders, entrepreneurs and/or promoters to understand how diverse forms of capital will always play an important part in the value creation for any business. Traditional options like equity funding and bank loans still serve most businesses well. However, as the economy evolves, it opens doors for more sophisticated funding options, accommodating various stages of business growth – like Quasi Equity. Quasi Equity is a form of capital that bears resemblance to equity funding but stands apart in significant ways like – no equity dilution, no questions asked, no collateral or interest, and most importantly, no bias. Nowadays, businesses are also using equity-free capital solutions like cash flow-based financing and performance-credit to extend their runway without diluting equity. For businesses in the growth stage, it is often more prudent to retain equity, allowing valuation concerns to take a backseat while focusing on sustainable growth to drive value creation. Though the traditional funding approaches are facing challenges, there is a lot of dry powder accumulating on the sidelines waiting to be deployed by the investors and here comes our role – to provide our clients with a hassle free, fundraising journey. We at Indcap Advisors Pvt. Ltd., have over the last 25 years, been providing customized solutions in the areas of Corporate Finance and Management Advisory, Private Equity, Mergers and Acquisitions, Valuation and Restructuring Advisory. Our team has expertise in advising clients on the kind and amount of funding required depending on where a business stands in its journey as we believe in one-size-does-not-fit-all. Sources:

Many banks and Non-Banking Financial Companies (NBFCs) have been charging penal interest, over and above the applicable interest rates as a revenue generative toolfrom defaulting borrowers. This practice concerned the RBI and it has issued notification on Fair Lending Practice-Penal Charges in Loan Accountsunder which, with effect from January 01, 2024,all lenders (banks, NBFCs and other lending institutions regulated by the RBI) would be able to levy only reasonable penal charges in case of default in repayment of loans. The new directive states that penalty if charged for non-compliance of material terms and conditions of loan contract by the borrower would be treated as ‘penal charges’ and shall not be levied in the form of ‘penal interest’ that is added to the rate of interest charged on the advances. However, the instructions will not apply to credit cards, external commercial borrowings, trade credits and structured obligations which are covered under product-specific directions. This act ofthe RBI is primarily to inculcate a sense of credit discipline and transparency among the lenders’ community. Interest Cost, as we know,is the prime mover and revenue generator for lending institutions and the debt markets. Corporates procure loans/debt from regulated lenders in order to leverage their companies with the right mix of owned and borrowed capital. Interest costs have a close nexus with the timing and quantum of raising funds and we at Indcap Advisors Pvt. Ltd., have over the last 25 years, been providing customized solutions in the areas of Corporate Finance and Management Advisory. Sources:

India Corporates, non-banking financial companies (NBFCs) and banks have been witnessing a steep rise in fundraising on account of recent fall in yields as lower interest rates for organizations typically help bring down lending rates, which in turn can push demand up. The spread between lending rates and yields further rose as the latter eased after banking system liquidity improved. Alongside the interest rate advantage, the appetite for corporate debt is also improving as the RBI’s recent move to withdraw currency notes of 2,000-rupee denomination is expected to boost liquidity. NBFCs have raised around 100 billion rupees via bonds in the past few months and there is a rate arbitrage, which the NBFCs are utilizing between MCLR-linked bank loans and short-term capital market instruments, as short-end yields are edging lower. A glimpse of the growing debt raising momentum can be seen with the capital raise plans of NBFCs – Funds mobilized through corporate bond issuances amounted to Rs 84,000 crore during May-June 2023, significantly higher than Rs 18,000 crore for the same period in the preceding year, according to RBI data. Raising of funds whether by equity or debt acts as a catalyst to the growth process of any company and we at Indcap Advisors Pvt. Ltd. could be your one stop solution for all your fund-raising activities whether from private or public sources. Our experienced team of professionals offer custom made solutions that fit your capital requirement as well as dilution criteria.

The tie up between HDFC Bank Ltd. and Housing Development Finance Corporation, would rank this Indian bank fourth in the global ranking system. Until now, the largest American and Chinese lenders had occupied the ranks of the ‘World’s Most Valuable Banks’. The completion of this merger is tentatively set in July 2023, and with this merger it is estimated that the accumulated Market Capitalization of HDFC Ltd and HDFC Bank Ltd would surpass that of the 4 private banks and 13 government owned banks which stands at INR 14.3 trillion and INR 9.77 trillion respectively. To compare, HDFC Ltd. alone has a market value of INR 5.19 trillion and HDFC Bank Ltd. has market value of INR 9.47 trillion. The total value of the merged entity is about $172 billion. The tie up between HDFC Bank Ltd. and its parent HDFC is expected to be at a valuation of INR 14.7 trillion with a total of 120 million customers, branch network to over 8,300 and a total headcount of 1,77,000+ employees. The Merged entity is expected to grow at 18% to 20% with an exceptional visibility in earnings growth and plans to double their brand presence in the next 4-5 years. By way of this merger, the parent’s home loan business would be added to the Bank’s portfolio, which was limited due to continuous referrals to the parent. Through this strategy, an entry into the lucrative housing finance market would permit the merged entity to have a home loan book of INR 7.3 lakh crore. The share swap would be at a ratio of 42:25 i.e., shareholders in HDFC will receive 42 shares of the bank for every 25 shares held, giving them ownership of 41% in the lender. The merger has already been approved by the concerned governmental authorities like Reserve Bank of India (RBI), National Company Law Tribunal (NCLT), Pension Fund Regulatory and Development Authority (PFRDA), Securities and Exchange Board of India (SEBI), the Competition Commission of India and Indian Stock Exchanges i.e., Bombay Stock Exchange (BSE) & National Stock Exchange (NSE). This merger unleashed the true value of both the entities and brought forward a stronger valuation as a merged entity. We at Indcap, can assist you by unleashing your potential value with our wide range of professional customised solutions.

Growth in any enterprise means growth in total assets of the company. Those assets are generated broadly via two sources: Debt and Equity Debt- you can buy assets with the debt you take. That debt, in a future moment will have to be returned plus interest to a bank/FI. Equity or capital financing which is, money from the investors 

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