Top 15 NBFCs lose more than ₹75,000 crore in two sessions

THE SELLOFF IN NBFC STOCKS CONTINUED ON MONDAY, DESPITE THE GOVERNMENT AND REGULATORS STEPPING IN TO CHECK THE PANIC

MUMBAI: India’s top 15 non-banking finance companies (NBFCs) have together lost over ₹75,000 crore in the last two trading sessions on fears of a financial crunch in the sector.

Across Friday and Monday, HDFC Ltd lost around ₹18,600 crore, Bajaj Finance Ltd around ₹13,800 crore and Bajaj Finserv Ltd ₹4,200 crore. The other 12 NBFCs, including Dewan Housing Finance Ltd (DHFL), Indiabulls Housing Finance Ltd and L&T Finance Holdings Ltd, lost ₹900-7,500 crore in the same period.

The sell-off in NBFC stocks continued on Monday, despite the government and regulators stepping in to check the panic. Finance minister Arun Jaitley tweeted Monday that the Centre would take all steps to ensure adequate liquidity was provided to NBFCs, mutual funds and small and medium enterprises.

The slide in NBFC stocks started after reports last week that Infrastructure Leasing and Financial Services Ltd (IL&FS) and its units had defaulted on repayments, and accelerated after rumours that DSP Mutual Fund had sold commercial papers issued by DHFL in the secondary market at a discount. DHFL shares, which had crashed over 40% on Friday, gained over 25% on Monday after the mortgage lender clarified it had not defaulted on any repayments and had enough liquidity to meet its obligations till March 2019.

“Investors raised concerns over tightness in the money market amid continuing financial crisis at IL&FS. Further, investors are risk averse after the recent experience of IL&FS, which dampened overall market sentiment,” said IIFL in a September 21 note.

Meanwhile, IL&FS Transportation Network Ltd, a unit of IL&FS, surged 20% during the day on Monday on a media report that Japan’s Orix Corp. is keen to acquire a majority stake in its parent company. The stock lost some of its gains and closed 13% higher at ₹22.65.