HDFC Securities on Banks: Sector Credit Trends, Growth continues to moderate | Personal loan growth impacted most by COVID-19
Industrial credit degrew (-1.7% YoY) for the first time in 3 years, and this trend was led by large industrial credit, which degrew 2.9% YoY. On a YTD basis, overall / large industrial credit de-grew 5.7/6.7%. Aided by disbursals under the MSME credit guarantee scheme, growth in credit to medium industries continued to accelerate, reaching 16.7%, even as MoM growth slowed from 11.9% in September to 2.4%. Within industrial credit, sectors such as gems and jewellery, glass and glassware and all engineering including electronics saw persistent YoY degrowth, together, these constitute 18.4% of industrial credit.
Service sector credit growth accelerated slightly from 9.1% in September to 9.5% in October. A major driver of this trend was growth in trade credit, which reached 14% YoY, vs. 11.5% in September: Reuters