Shriram Finance shares fall over 6 pc, hit 11-month low on growth cut

New Delhi: Shares of non-banking financial company Shriram Finance on Monday traded more than 6 per cent lower, hitting an 11-month low and emerged as the top Nifty loser.

The NBFC stock declined as much as 6.55 per cent to 810.20, recording an intraday low on the BSE in morning trade.

It was trading at Rs 829.20, a decrease of 4.36 per cent by 10:57 am.

The selling pressure in the stock came after the NBFC firm cut its loan growth forecast and flagged higher credit costs, overshadowing better-than-expected Q2 profit.

Moreover, the company cut its assets under management (AUM) growth guidance for FY27 to 15-17 per cent from 18 per cent, citing weak monsoon and geopolitical uncertainty and pressure on borrowers in drought-hit regions.

Meanwhile, analysts flagged asset quality concerns with reducing share price targets.

Analysts at global brokerage Jefferies said credit costs could stay elevated for one to two more quarters due to stress in Maharashtra, Karnataka and Telangana.

According to domestic brokerage Motilal Oswal, higher slippages and write-offs reflected drought-like conditions in several states, though overall asset quality remained broadly stable.

"SHFL delivered a mixed quarter, with PPoP beating estimates on higher NIM and lower opex, while earnings were in line due to higher credit costs. AUM growth at 17 per cent YoY was stronger than estimated," it said.

Similarly, JM Financial said rising early delinquencies and rural stress remain key concerns. The brokerage also stated, "Deteriorating asset quality indicators amid drought-like conditions remain a concern.” However, the stock has corrected 14 per cent over the past month. Recent equity infusion and rating upgrades to AAA should cushion margins.

On the aforesaid exchange, the NBFC stock has recorded a 52-week high of Rs 1,153.65 and a 52-week low of Rs 710.40.

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