IIFL Finance shares hit 52-week low after HSBC downgrades NBFC stock, halves target price
IIFL Finance share price target: HSBC has downgraded IIFL Finance to 'underperform' from 'buy' and reduced its target for the stock by Rs 450 to Rs 340 per share.
IIFL Finance share price, IIFL Finance share price target: IIFL Finance shares faced selling pressure on Thursday, March 14, after foreign brokerage HSBC downgraded the NBFC stock to 'underperform' from 'buy' and reduced its target price by more than half to Rs 340 apiece. The IIFL stock ended 3.3 per cent lower at Rs 371.2 apiece, falling for the fifth trading session in a row, after dropping as much as 4.7 per cent to a 52-week low of Rs 366 apiece in intraday trade on BSE.
HSBC's target price implied a downside of 11.4 per cent from Wednesday's closing price.
IIFL Finance latest news: Fund-raise
After market hours on Wednesday, IIFL Finance said its board had approved raising up to Rs 2,000 crore through a mix of rights (Rs 1,500 crore) and non-convertible debentures (Rs 500 crore).
The NBFC looks to shore up its capital after the RBI barred it from sanctioning, disbursing, and selling gold loans citing "material supervisory concerns" in its gold loan portfolio, causing a meltdown in its stock.
IIFL Finance share price target: HSBC downgrades to underperform
While downgrading the stock to 'underperform', the brokerage reduced its target for the NBFC stock to Rs 340 from Rs 790.
Why the brokerage turned bearish
According to HSBC, as IIFL Finance's gold loan business stands disrupted, it may impact the company's overall AUM growth, revenue and profitability, and force its other businesses to moderate growth.
The brokerage reduced its FY25-26 earnings per share estimates for the NBFC to 21-38 per cent.
The actions by lenders and credit rating agencies remain uncertain, it added.
With inputs from agencies
Get Latest Business News, Stock Market Updates and Videos; Check your tax outgo through Income Tax Calculator and save money through our Personal Finance coverage. Check Business Breaking News Live on Zee Business Twitter and Facebook. Subscribe on YouTube.
RECOMMENDED STORIES
RCB vs CSK IPL 2024 Ticket Booking Online: Where and how to buy RCB vs CSK tickets online - Check IPL Match 68 ticket price, other details
Gold and Silver rate today (May 14, 2024): Precious metals trade in green; yellow metal above Rs 72,000 once again, white metal near Rs 85,350
Bandhan Bank Q4 FY24 Results Preview: PAT, interest income likely to grow in almost double digits; asset quality may improve
TBO Tek IPO Listing LIVE Update: Bumper Debut! Share list at 55% premium - Buy, sell or hold? Check Anil Singhvi's view
SIP Returns: How Rs 3,000, 5,000, and Rs 10,000 SIPs can help you build retirement corpus of Rs 1.06 cr, Rs 1.77 cr, and Rs 3.53 cr
06:56 PM IST