IIFL Finance shares fell up to 20% after the RBI order.

The RBI ordered an immediate ban on IIFL finance from sanctioning and disbursing gold loans. However, the company is allowed to manage its existing gold loan portfolio.

IIFL finance

Anchor: Today, IIFL Finance shares fell up to 20% following RBI orders. What did RBI order and what is the reason behind the fall of IIFL Finance’s shares? To answer these questions, we have with us Sanjay Shekhawat. who explains to our viewers what is happening in the world of business and the stock market. Sanjay, explain to our viewers what is happening with IIFL finance shares. start with the RBI order.

Sanjay: thank you for having me. So, yesterday RBI ordered an immediate ban on IIFL finance from Sanctioning and disbursing gold loans. It means RBI has ordered The company to stop giving gold loans to customers right away.

Anchor: And why did RBI order this?

Sanjay: Yes, I am coming to that point. RBI was worried about how IIFL finance was handling its gold loan business. RBI found major management concerns in its gold loan portfolio. So, until things get better The company cannot give any more gold loans.

Anchor: what about Existing gold loans?

Sanjay: The company is allowed to manage its Existing gold loan portfolio. I would like to read the RBI statement they made in the press release So our viewers get more ideas.

“The Reserve Bank of India has today, in the exercise of its powers under Section 45L(1)(b) of the Reserve Bank of India Act, 1934, directed IIFL Finance Ltd. (“the company”) to cease, 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 usual collection and recovery processes.”

Anchor: is there any response from the company?

Sanay: yes, IIFL made their clarification on the RBI action. The company said, “We reaffirm our commitment to rectify observations of the RBI in the gold loan portfolio to comply with RBI findings at the earliest and will continue with our endeavour to provide gold loan services in the overall interest of customers”.

Anchor: Now, what should one do if they have IIFL Finance shares in their holdings?

Sanjay: if you look at the last year, IIFL shares have risen 31%. An important thing is Jefferies, a leading global, full-service investment banking and capital markets firm, holds onto a ‘buy’ call on IIFL Finance, Even after RBI’s order. The firm gave the target price of ₹765 per.

Anchor: The company’s managing director has given his statement, right?

Sanjay: Yes, Recently, Nirmal Jain, managing director of IIFL Finance Ltd, said, “We have taken corrective action to ensure that differences in assessment of gold value between branches (and) audit teams are minimal.” He also said that there are no governance issues and they have also approached the RBI for an urgent meeting.

Anchor: So, these future events will be crucial for IIFL. Thank you for joining us, Mr. Sanjay.

Sanjay: My pleasure.

Anchor: Yesterday, IIFL Finance shares closed 3 per cent lower at ₹598.00. Today, it closed at ₹477.75, which is almost 20 per cent lower than yesterday, down by ₹119.40. The upcoming meeting with the RBI will be crucial for the company. Stay tuned. we will keep you updated.


Dear Readers,

If you wish to read our other blogs, click here

If you wish to read a blog from another website, click here


FAQ

1. What led to the sharp fall in IIFL Finance shares?

The shares fell by up to 20% following RBI orders that banned IIFL Finance from sanctioning and disbursing gold loans due to major management concerns in its gold loan portfolio.

2. What is the current status of existing gold loans with IIFL Finance?

The company is allowed to manage its existing gold loan portfolio through usual collection and recovery processes, as per the RBI directive.

3. What is the outlook for IIFL Finance shares in the future?

Despite the RBI’s order, Jefferies holds a ‘buy’ call on IIFL Finance with a target price of ₹765, showing optimism for the company’s future.

Leave a Reply

Scroll to Top