InvestorQ : With an aggressive 75 bps rate cut, what sectors and stocks you think will benefit the most at this point of time?
manisha Kolvenkar made post

With an aggressive 75 bps rate cut, what sectors and stocks you think will benefit the most at this point of time?

Answer
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Roshni Hegde answered.
7 months ago


In order to stem the coronavirus induced crisis, the Reserve Bank of India (RBI) today on March 27 trimmed the repo rate by 75 basis points to 4.40% from 5.15%. This meeting by the monetary policy committee on the repo rate can be called as an emergency step by the government.

As per the majority in the meeting rate from today is cut to 4.65% from 5.40 percent.


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Mahima Roy answered.
7 months ago


Clearly, the rate cut will be most beneficial to rate sensitives. This will be good news for sectors like banks, NBFCs, real estate and auto stocks. However, there is also the immediate worry of business coming to a standstill for the time being and limited cash flow visibility due to likely delays in payment of EMIs and instalments. Some of the stocks to benefit would include the banks like HDFC Bank and SBI which can bet on a sharp revival in demand for loans when the activity actually picks up in the economy. On the auto front, the two wheelers could get a boost from lower rates as well as entry levels cars. The clear beneficiaries will be Bajaj Auto and Maruti. Among the realty companies, we could see DLF being a major beneficiary and some sound companies like Prestige, largely a south based company. Also select NBFCs like Bajaj Finance and HDFC could also benefit from lower rates.