The record growth result of the leasing market cannot be repeated in 2024

The record growth result of the leasing market at the end of 2023 cannot be repeated in 2024. The NRA agency expects an increase in the number of leased items transferred to clients by 20%, to 700 thousand. At the end of last year, the growth was twice as large. For certain items, the market is already close to saturation, experts say. In addition, after the key rate increase, many clients reduced or postponed modernization programs.

According to preliminary data from the NRA (Kommersant has read the report), the number of new leased items transferred to clients in 2023 reached 611 thousand. This result is 40% higher than the “crisis” year of 2022 (431 thousand) and 6% higher than in the previously record year 2021 (565 thousand).

The largest increase of 120% was observed in the computer equipment segment, where the low base effect of 2022 was clearly evident. In addition, the segments of passenger cars (by 60%) and commercial vehicles (by 45%) showed high growth rates. This is due to state support measures (compensation for a discount to the lessor on an advance payment) for wheeled vehicles, high activity in the construction industry, as well as the replacement cycle of freight and corporate vehicles, analysts note.

According to NRA estimates, the total leasing portfolio at the end of 2023 will reach 8.4 trillion rubles, which is 24% higher than the result a year ago. Expert RA previously estimated the volume of new business at the end of 2023 at 3.41 trillion rubles, which is 70% higher than the previous year (see Kommersant on December 5, 2023).

Industry companies confirm record results for 2023. According to preliminary data, the volume of new business of the Gazprombank Leasing group in 2023 almost doubled. Interleasing ended the year with a 70% increase in new business. The final volume of investments in the new business for 2023 turned out to be “15% higher than our baseline forecasts,” Alfa Leasing Group of Companies said. “The result, in addition to the increase in the number of transactions and sales volumes, was also influenced by the increase in the value of property and the increase in the size of investments in each transaction due to a decrease in advances,” explains Alfa-Leasing Group Sales Director Alexander Golankov.

But in 2024, the leasing market is expected to slow down. The renewal cycle for corporate and freight vehicles is coming to an end, and tight monetary policy will continue to have a cooling effect on demand from potential lessees, explains Anna Kudrinskaya, director of financial company ratings at NRA.

NRA’s baseline forecast assumes that the number of new leased items transferred to customers in 2024 will be approximately 740 thousand units (an increase of 21%). In the passenger vehicle segment, the rate of increase will be reduced to 15–20%, the agency estimates. “In 2024, car leasing will remain a significant driver of the market, as the need to renew company fleets remains,” says Anton Musatov, General Director of VTB Leasing Group. “However, the direction will not grow as dynamically as in 2023, due to the increased cost of financial resources and reducing the impact of pent-up demand formed in 2022.” In the commercial vehicle segment, the increase will be 10–15%, “it will be pulled out by an increase in cargo turnover and the need to replenish the fleet to cover longer distances,” notes Anna Kudrinskaya.

“In general, at the end of the year, we will ensure business volume and profitability mainly through vehicles, special equipment, railway vehicles and equipment,” notes General Director of GPB Leasing Maxim Kalinkin.

The total leasing portfolio could grow by 18%, to 9.9 trillion rubles, and the volume of new business – by 35-40%, primarily due to the rise in price of leased items, the NRA believes. Market participants also assess its prospects quite conservatively: in 2024 there will be growth of 15–20% in monetary terms, expects Interleasing commercial director Sergei Zharkov.

The situation will be pressured by a shortage of leased items due to sanctions, disruptions in logistics and payment chains, a decrease in demand for leasing due to the rise in price of leased items, as well as a decrease in the credit quality of lessees, believes Anna Kudrinskaya. After the key rate increase, explains Region Leasing CEO Rustem Mukhamedov, many clients “reduced or postponed modernization programs.”

Polina Trifonova