Shares of housing finance firm DHFL recovered on Monday following five consecutive sessions of decline, after the firm said that it would sell assets and some of its other businesses in order to address liquidity concerns.
Shares of housing finance firm DHFL recovered on Monday following five consecutive sessions of decline, after the firm said that it would sell assets and some of its other businesses in order to address liquidity concerns. DHFL shares closed 4.17% higher at Rs 116.10 on BSE. The stock rose after the firm’s management tried to assuage liquidity concerns on a conference call with investors, media and analysts. Notably, the scrip lost nearly half of its market value over five sessions ending on Friday, recording its worst week since listing, hit by claims of financial mismanagement – which it has denied – and broader sectoral woes, according to a Reuters report.
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The decision to explore the sale of its non-core businesses comes amid a slew of allegations by investigative media outlet Cobrapost, which last week said DHFL diverted loans from state banks to shell companies, including those linked to its controlling shareholders, added the agency report. Yesterday, CARE Ratings had
“While stock prices and credit spreads were negatively affected for non-banking finance companies (NBFCs) and housing finance companies (HFCs) post September 2018, recent media news related to DHFL has further impacted market sentiment. DHFL’s ability to raise resources at competitive rates would be crucial for its profitability and long-term growth prospects going forward,” CARE Ratings said in a statement.