Manappuram Finance Shares Crumble By Over 20% In 5 Days, Stock Continues To Bleed On Monday
This development came to pass after the Thrissur-based company's IPO-bound MFI or microfinance institution subsidiary, Asirvad Micro Finance, was banned from disbursing any loans, starting today, October 21.
The shares of one of the most renowned Non-Banking Financial Corporations, or NBFCs, in India, Manapurram Finance, continue to remain in a soup as the new trading week begins on Monday. The company shares collapsed by a monumental 2.94 per cent at the very opening of the day's trade on October 21.
RBI Bans Loan Disbursal
This development came to pass after the Thrissur-based company's IPO-bound MFI or microfinance institution subsidiary, Asirvad Micro Finance, was banned from disbursing any loans, starting today, October 21.
The country's central bank, the RBI, took this decision on October 18, as it banned a tranche of 3 other NBFCs, including Arohan Financial Services, DMI Finance Private and Navi Finserv, from transacting these loans. Here, Navi Finserv is a company owned by Flipkart co-founder and its former executive, Sachin Bansal.
Governor Shaktikanta Das-led RBI reportedly took this decision to 'ensure the stability and compliance of the financial sector'.
As mentioned before, given its status as an unlisted company waiting in the ranks to get on the equity market, Asirvad Microfinance will not directly bare the brunt of these developments, thereby passing on the impact from the RBI decision onto the parent company, Manapurram Finance.
NBFC Shares Drown In A Pool Of Red
The shares of Manapurram Finance, which saw a great decline on Friday, have suffered a major leakage of value.
In the past five trading sessions at Dalal Street, the shares have declined by mammoth 21.17 per cent or Rs 39.39.
The story was no different on October 21, as without a doubt, the markets appeared to have overwhelmingly inclined towards an exodus from the company at the equity markets.
In the very first hour of the intraday trade on Monday, the company shares dropped by a significant 4.69 per cent or Rs 7.19. This took the overall value of the NBFCs shares to Rs 146.08. This is much lower than the stock's 52-week high of Rs 230.40 per share.
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