The share price of Muthoot Finance, Mannapuram Finance, IIFL Finance, Cholamandalam Investment, and Fin Co declined as much as 20% after the Reserve Bank of India announced will soon issue comprehensive guidelines on loans against gold.
The co-lending guidelines will be extended to all regulated entities. RBI governor Sanjay Malhotra said that detailed guidelines will be provided for loans secured by gold and for non-fund-based entities.
The share price of Muthoot Finance was trading 9.28% lower at Rs 2,080 while that of IIFL Finance was trading 4.56% lower at Rs 318.35 on the National Stock Exchange. Manappuram Finance’s shares were trading 2.58% lower at Rs 223.15 and Cholamandalam Investment and Fin Co was down 2.82% trading at Rs 1,422 per equity share around 12.13 PM.
The lender of last resort cut the key repo rate by 25 basis points to 6% on Wednesday for a second consecutive policy. Also, it changed its monetary policy stance to ‘Accumulative’ from ‘Neutral’, signalling room for more cuts ahead. The cut seeks to boost the sluggish economy, which is facing further pressure from US President Donald Trump’s tariffs.