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IIFL Finance shares bounce back after two days of sharp fall

IIFL Finance shares bounce back after two days of sharp fall
New Delhi, Shares of IIFL Finance Ltd bounced back on Thursday and climbed nearly 10 per cent after tumbling in the past two trading days. The stock jumped 9.82 per cent to settle at Rs 420.40 apiece on the BSE. During the day, it soared 9.99 per cent to Rs 421.05 -- its upper circuit limit.

On the NSE, it climbed 9.35 per cent to Rs 417.95 per piece.

Shares of IIFL Finance Ltd had declined for the second day in a row on Wednesday post the Reserve Bank's action against the company. On Wednesday and Tuesday, the stock tanked 20 per cent each.

In a statement on Monday, the RBI said it has directed IIFL Finance Ltd "to cease and desist, with immediate effect, from sanctioning or disbursing gold loans or assigning/ securitising/ selling any of its gold loans".

The company can, however, continue to service its existing gold loan portfolio through the usual collection and recovery processes, it added.

Indian-Canadian billionaire Prem Watsa-backed Fairfax India on Wednesday announced its commitment to provide up to USD 200 million (about Rs 1,650 crore) liquidity support to IIFL Finance after the Reserve Bank of India barred the non-bank lender to disburse gold loans.

The RBI's embargo has raised liquidity concerns among the company's investors and lenders, Fairfax India Holdings Corporation said in a statement.

In response to these concerns, Fairfax India has agreed to extend up to USD 200 million of liquidity support on terms to be mutually agreed and subject to applicable laws, including regulatory approvals (if any), it added.

IIFL Finance offers a range of loans and mortgages. The latest directions from the RBI pertain to only the gold loan business.


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