IIFL Finance: The stock prices of JM Financial experienced a notable decline of approximately 4 percent, while IIFL Finance saw a more significant plunge of 5.5 percent following the Reserve Bank of India’s announcement of a special audit for these two firms.
By 12:40 pm, JM Financial was trading at Rs 72 on the BSE, marking a 3 percent decrease from its previous closing price. Concurrently, IIFL Finance witnessed a 2.5 percent decline, trading at Rs 325 per share.
JM Financial has continued its downward trend, trading in the red during 11 out of the last 16 sessions. Similarly, IIFL has experienced losses in 12 sessions within the same period. Notably, since early March, IIFL Finance has seen a substantial decline of over 45 percent, while JM Financial has fallen nearly 25 percent.
Industry experts foresee that the audit could span a duration of four to six weeks, potentially leading to the implementation of stricter protocols to ensure the issuance of clean loans and mitigate the risk of overleveraging. Analysts further indicated that collaborative regulatory measures might be taken to address apprehensions regarding undisclosed credit utilization.
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Earlier, the RBI expressed apprehensions regarding IIFL Finance’s gold loan portfolio and imposed restrictions on specific loan activities. Similarly, JM Financial faced limitations on certain financing activities as well.
In its recent note, Motilal Oswal highlighted that prolonged restrictions could exacerbate the decline and potentially inflict reputational damage on IIFL Finance.
Disclaimer: Stockeasynow provides stock market news for informational purposes only and should not be construed as investment advice. Readers are strongly encouraged to consult with a qualified financial advisor before making any investment decisions.
