Fitch raises outlook for India auto loans to 'neutral' from 'deteriorating'

Economic recovery supports stable asset performance

Rating agency Fitch Ratings has revised outlook on Indian auto loans to from 'deteriorating' to 'neutral' due to stable asset performance that is supported by economic recovery.

The average arrears in the 90-plus days past dues (DPD) bucket for rated asset backed securities (ABS) fell from a peak of 1.9 per cent in June to just one per cent in September. While risks from the new wave of Covid-19 infections remain, any stress is expected to be temporary and less severe than seen in FY21.

The operating environment for the commercial vehicle (CV) sector, which comprises a major part of