IIFL Finance shares tumble another 20%; fall for 2nd day

New Delhi: Shares of IIFL Finance Ltd continued their slide for the second day in a row on Wednesday, falling another 20 per cent, post the Reserve Bank's action against the company.

The stock tanked 20 per cent to settle at Rs 382.80 -- its lower circuit limit as well as 52-week low -- on the BSE.

At the NSE, it tumbled 20 per cent to Rs 382.20, hitting the lower circuit limit as well as 52-week low.

Shares of IIFL Finance Ltd had slumped 20 per cent on Tuesday as well after the Reserve Bank barred the firm from disbursing gold loans, with immediate effect following multiple supervisory concerns, including serious deviations in assaying and certifying the purity of the yellow metal.

In two days, the company's market valuation eroded by Rs 8,395.83 crore to Rs 14,603.17 crore.

In a statement on Monday, the RBI said it has directed IIFL Finance Ltd "to cease and desist, 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 the usual collection and recovery processes, it added.

IIFL Finance offers a range of loans and mortgages. The latest directions from the Reserve Bank of India (RBI) pertain to only the gold loan business.

Indian-Canadian billionaire Prem Watsa-backed Fairfax India on Wednesday announced its commitment to provide up to USD 200 million (about Rs 1,650 crore) liquidity support to IIFL Finance after the RBI barred the non-bank lender from disbursing gold loans.