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ESAF Small Finance Bank is set to raise 300-500 crore in tier-1 capital, anticipating a business turnaround from the third quarter. The bank aims to bolster its capital adequacy ratio and fund expansion plans. A board meeting is scheduled for September 20 to finalize the fundraising details, including the instrument and modalities.
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The findings present a contrast to the relatively upbeat tone struck by several of the countrys largest banks. Lenders have argued that consumers remain broadly stable and that the overall quality of their credit portfolios has not shown significant cracks. At the same time, wider economic data suggests the labour market is cooling, which could affect future repayment capacity.
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Small-cap solvent extraction companies have seen significant gains due to high edible oil demand, ethanol blending, and supportive policies. However, analysts now advise caution, noting that valuations may be exceeding fundamentals. Risks like raw material price volatility and supply challenges could lead to corrections, suggesting investors consider booking profits or waiting for better entry points.
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